BOARD MEETING

STATE OF CALIFORNIA

AIR RESOURCES BOARD

LOS ANGELES AIRPORT MARRIOTT HOTEL

SUITES A, B, AND C

5855 WEST CENTURY BOULEVARD

LOS ANGELES, CALIFORNIA

THURSDAY, JUNE 21, 2007

9:00 A.M.

TIFFANY C. KRAFT, CSR, RPR

CERTIFIED SHORTHAND REPORTER

LICENSE NUMBER 12277

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345ii

APPEARANCES

BOARD MEMBERS

Dr. Robert Sawyer, Chairperson

Ms. Sandra Berg

Ms. Judith Case

Ms. Dorene D'Adamo

Supervisor Jerry Hill

Ms. Lydia Kennard

Mrs. Barbara Riordan

Dr. Daniel Sperling

STAFF

Mr. Tom Cackette, Chief Deputy Executive Officer

Mr. Tom Jennings, Chief Counsel

Mr. Michael Scheible, Deputy Executive Officer

Ms. Lynn Terry, Deputy Executive Officer

Ms. Kathleen Quetin, Ombudsman

Ms. Catherine Witherspoon, Executive Officer

Ms. Lori Andreoni, Board Secretary

Mr. Alberto Ayala, Manager, Climate Change Mitigation &

Emissions Research Section

Ms. Deborah Drechsler, Ph.D., Health and Exposure

Assessment Branch, Research Division

Mr. Craig Duehring, Staff, Mobile Source Control Division

Mr. Bob Jenne, Senior Staff Counsel

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345iii

APPEARANCES CONTINUED

STAFF

Dr. Nehzat Motallebi, Staff Air Pollution Specialist, Air

Quality and Climate Science Section, Research Division

Mr. Michael Roberts, Staff, Research Division

Mr. Michael Werst, Staff, Monitoring & Laboratory Division

ALSO PRESENT

Mr. John Andrew, DWR

Mr. Larry Allen, CAPCOA

Ms. Martha Arguello, P.S.R.

Ms. Cynthia Babich, Del Amo Action Committee

Ms. Diane Bailey, NRDC

Mr. John Bishop, Traffic Bulldog

Mr. John Cabaniss, Association of International Automobile

Manufacturers

Mr. Darrell Clarke, Sierra Club

Mr. Albert Cohen, Southern California Ecumenical Council

Mr. Dominic DiMar, Cal Chamber

Mr. Steven Douglas, Alliance of Automobile Manufacturers

Mr. Joe Gershen, Environmental Entrepreneurs E2

Mr. Howard Gollay, Southern California Edison

Mr. Philip Huang, Communities for a Better Environment

Ms. Bonnie Holmes-Gen, American Lung Association

Ms. Laura Hunter, Environmental Health Coalition

Mr. Roland Hwang, NRDC

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Mr. Roger Isom, California Cotton Ginners and Growers

Association

Mr. Thomas Jacob, Du Pont

Ms. Angela Johnson-Meszaros, Environmental Justice

Advisory Committee, Implementation of Global Warming

Solutions Act of AB 32

Mr. Bill Karambelas, Fuel Cell Manufacturers

Ms. Kristin Kenausis, U.S. Environment Protection Agency,

Office of Transportation and Air Quality

Mr. Mark Leary, California Integrated Waste Management

Board

Mr. Bob Lucas, CCEEB

Mr. Aaron Lowe, AAIA

Mr. Joseph Lyou, California Environmental Rights Alliance

Ms. Julia Mather, Friends for a Livable Planet

Ms. Julie May, CBE

Mr. Jay McKeeman, CIOMA

Mr. Rachel McMahon, CEERT

Mr. Leo Miras, Environmental Health Coalition

Ms. Patricia Monahan, Union of Concerned Scientists

Ms. Rachel Oster, Norcal Waste System

Ms. Rupal Patel, Communities for Clean Ports

Mr. Dave Patterson, Mitsubishi Motors

Mr. Norm Plotkin, Plotkin Zins and Associates

Mr. Bill Quest, ARPI

Ms. Cathy Reheis-Boyd, WSPA

Mr. Mike Sandler, Climate Protection Campaign

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345v

APPEARANCES CONTINUED

ALSO PRESENT

Ms. Kathy Seal, Friends for a Livable Planet

Ms. Mitzi Shpak, Action Now

Mr. Kenneth Smokoska, California Conservation Committee

Mr. Jim Stewart, Sierra Club

Ms. Robina Suwol, California SAFE Schools

Mr. Al Thornton, Cemtura

Mr. Virgil Welch, Environmental Defense

Ms. Jill Whynot, SC AQMD

Ms. Jane Williams, Environmental Justice Advisory

Committee

Mr. Robert Wyman, California Climate Coalition

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345vi

INDEX

PAGE

Item 7-7-1

Chairperson Sawyer 3

Executive Officer Witherspoon 3

Staff Presentation 4

Q&A 10

Item 7-7-2

Chairperson Sawyer 12

Staff Presentation 12

Q&A 17

Motion 19

Vote 19

Motion 19

Vote 20

Item 7-7-3

Chairperson Sawyer 21

Executive Officer Witherspoon 21

Staff Presentation 21

Q&A 34

Item 7-7-4

Chairperson Sawyer 37

Executive Officer Witherspoon 38

Staff Presentation 39

Ms. Johnson-Meszaros 66

Q&A 77

Mr. Leary 129

Ms. Reheis-Boyd 132

Mr. Jacob 136

Mr. Thornton 138

Mr. Quest 142

Mr. Plotkin 148

Mr. Lowe 150

Ms. Oster 152

Mr. Wyman 153

Mr. DiMare 155

Ms. Hunter 157

Ms. Monahan 160

Mr. Welch 162

Dr. Lyou 164

Ms. Suwol 167

Ms. Babich 168

Mr. Gershen 170

Mr. Allen 173

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INDEX CONTINUED

PAGE

Mr. Clarke 180

Mr. Lucas 182

Ms. Seal 184

Ms Arguello 186

Ms. Shpak 187

Mr. Andrew 188

Ms. Williams 190

Mr. Hwang 193

Ms. Patel 195

Mr. Miras 198

Ms. Holmes-Gen 200

Ms. Whynot 203

Ms. Bailey 207

Mr. Sandler 210

Mr. Smokoska 213

Ms. May 215

Mr. Huang 218

Mr. Karambelas 221

Mr. Cohen 224

Mr. Stewart 226

Ms. McMahon 227

Mr. Gollay 230

Mr. Fay 232

Mr. Frayre 235

Mr. Carmona 237

Mr. Marquez 238

Mr. Barbose 241

Mr. Torres 243

Mr. Helget 245

Mr. Leon 247

Mr. Gerard 249

Mr. Everts 251

Mr. Carmichael 253

Mr. Magavern 255

Mr. Haller 258

Q&A 259

Ex Parte 288

Motion 292

Vote 293

Vote 294

Vote 295

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INDEX CONTINUED

PAGE

Item 7-7-5

Chairperson Sawyer 296

Executive Officer Witherspoon 296

Staff Presentation 297

Ombudsman Quetin 312

Q&A 313

Mr. Douglas 315

Ms. Kenausis 318

Mr. Raney 320

Ms. Monahan 330

Mr. Cabaniss 331

Mr. Patterson 334

Motion 339

Vote 339

Item 7-7-6

Chairperson Sawyer 339

Executive Officer Witherspoon 339

Staff Presentation 340

Ombudsman Quetin 355

Q&A 357

Mr. Isom 359

Mr. McKeeman 362

Motion 364

Vote 365

Adjournment 365

Reporter's Certificate 366

PETERS SHORTHAND REPORTING CORPORATION (916) 362-23451

1 PROCEEDINGS

2 CHAIRPERSON SAWYER: Good morning. The

3 June 21st, 2007 public meeting of the Air Resources Board

4 will come to order. Please rise and join in the Pledge of

5 Allegiance.

6 (Thereupon the Pledge of Allegiance was

7 recited in unison.)

8 CHAIRPERSON SAWYER: Thank you. Will the Clerk

9 of the Board please call the roll.

10 SECRETARY ANDREONI: Ms. Berg?

11 BOARD MEMBER BERG: Here.

12 SECRETARY ANDREONI: Ms. D'Adamo?

13 Dr. Gong?

14 BOARD MEMBER GONG: Here.

15 SECRETARY ANDREONI: Supervisor Hill?

16 SUPERVISOR HILL: Here.

17 SECRETARY ANDREONI: Ms. Kennard?

18 Mayor Loveridge?

19 Mrs. Riordan?

20 BOARD MEMBER RIORDAN: Here.

21 SECRETARY ANDREONI: Supervisor Roberts?

22 Professor Sperling?

23 BOARD MEMBER SPERLING: Here.

24 SECRETARY ANDREONI: Chairman Sawyer?

25 CHAIRPERSON SAWYER: Here.

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1 SECRETARY ANDREONI: Mr. Chairman, we have a

2 quorum.

3 CHAIRPERSON SAWYER: Thank you. Yes.

4 BOARD MEMBER CASE: If the record could reflect

5 Judith Case is also here.

6 CHAIRPERSON SAWYER: Supervisor Case was not

7 called, apparently.

8 SECRETARY ANDREONI: Sorry. Supervisor Case.

9 BOARD MEMBER CASE: Here.

10 SECRETARY ANDREONI: Thank you. Sorry.

11 CHAIRPERSON SAWYER: Sorry about that.

12 I have a few opening remarks.

13 A closed session appears each month as a standing

14 item our agenda to receive reports on the various

15 greenhouse gas lawsuits in which we are litigants. Since

16 there is nothing to report this month, the closed session

17 notice for today's meeting is canceled.

18 Today, we will proceed with Board items listed on

19 the public agenda, and tomorrow we will resume at

20 8:30 a.m., to consider the California State Implementation

21 Plan first, unless some of today's business is carried

22 over. Anyone who wishes to testify should sign up with

23 the Board staff at the tables outside the boardroom and

24 has the option to include his or her name on the speaker

25 card. Please see Board staff for further instructions.

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1 Speakers, as usual, the Board will impose a

2 three-minute time limit. Please put your testimony into

3 your own words. It is easier for the Board to follow if

4 you go straight to your main points. You do not need to

5 read your written testimony since it will be entered into

6 the record.

7 For safety reasons, please note the emergency

8 exists to the left of the hearing room and to the rear.

9 In the event of a fire alarm, we must evacuate this room

10 immediately. When the all clear signal is given, we will

11 return to the hearing room and resume the hearing.

12 Agenda Item 7-7-1, Health Update. Today's

13 presentation addresses several of the Board's interests:

14 Ozone, asthmatic children, and the basis of vulnerability

15 to adverse effects from air pollution.

16 Ms. Witherspoon, please introduce this item.

17 EXECUTIVE OFFICER WITHERSPOON: Thank you,

18 Dr. Sawyer, and good morning members of the Board.

19 The relationship between ozone air pollution and

20 adverse health effects is well known. In addition, the

21 literature is clear that there's considerable variability

22 in the sensitivity between individuals. However, little

23 is known about the cause of this variability. One area of

24 active research is investigating genetic contributions to

25 sensitivity. This morning, staff will present the results

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1 of a recent paper that investigated the genetic makeup of

2 asthmatic children and how that influences their

3 respiratory responses to ozone.

4 Dr. Deborah Drechsler from our Health and

5 Exposure Assessment Branch will take the staff

6 presentation.

7 Dr. Drechsler.

8 (Thereupon an overhead presentation was

9 presented as follows.)

10 MS. DRECHSLER: Thank you, Ms. Witherspoon. Good

11 morning, Dr. Sawyer and members of the Board.

12 Staff has often spoken to you about the

13 considerable body of scientific literature indicating that

14 ozone exposure can induce adverse health impacts such as

15 reduced lung function, respiratory symptoms,

16 hospitalization, and emergency room visits. The staff has

17 not told you about how the body defends itself from injury

18 due to air pollution exposure.

19 The paper we are presenting this morning is by

20 Romeo, et. al., and is entitled, GSTM one and GSTP one and

21 Respiratory Health in Asthmatic Children Exposed to Ozone.

22 It appeared in the European Respiratory Journal in late

23 2006. The authors are associated with the National

24 Institute of Public Health in Cuernavaca, Mexico, the

25 Frederico Gomez Children's Hospital in Mexico City, and

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1 the U.S. National Institute of Environmental Health

2 Sciences.

3 The paper describes the results of a study of

4 asthmatic children living in Mexico City and the influence

5 of differences in two genes that are involved in defending

6 the body from ozone induced injury.

7 --o0o--

8 MS. DRECHSLER: It is well known that there is

9 considerable variability in responsiveness to ozone and

10 that people with asthma and other lung diseases have

11 responses that fall into the same range as healthy people.

12 This being said, people with compromised baseline lung

13 function, for example, due to asthma or other chronic lung

14 disease, are at increased risk because their responses to

15 ozone are superimposed on top of reduced baseline status.

16 A key unanswered question has been why some people are

17 more susceptible to adverse responses with environmental

18 exposures than others.

19 Research has only recently begun to address this

20 question. Recent findings from the Children's Health

21 Study and several other laboratories point to a role for

22 genetic differences in lung defense mechanisms in

23 explaining inter-individual differences in susceptibility

24 to environmental tobacco smoke and frequency of

25 respiratory illnesses. Several researchers have also

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1 begun to investigate the role of genetic difference in

2 susceptibility to ozone induced effects.

3 --o0o--

4 MS. DRECHSLER: Chemically, ozone is a strong

5 oxidant and it reacts with the fluid and cells lining the

6 airways causing injury to the lung tissues. One of the

7 lung's defense mechanisms involves enzymes that counteract

8 the effects of oxidants. Two of these enzymes are

9 glutathione estransferase M1, produced by the gene GSTM

10 one, and glutathione estransferase P1 produced by the gene

11 GSTP one. Each of these genes has two forms. The more

12 common form produces active enzymes that counteract

13 effects of oxidants. But both of the genes have a common

14 alternate or variant form. The variant type of GSTM one

15 gene produces an inactive enzyme that has no defensive

16 properties. The variant type of GSTP one gene produces an

17 enzyme with less active defense properties.

18 So we would expect that people who have the

19 inactive of GSTM one gene or the less active type of the

20 GSTP one gene would be more susceptible to ozone because

21 they have less effective defenses again oxidant injury.

22 --o0o--

23 MS. DRECHSLER: The study we are presenting this

24 morning involved 151 asthmatic children who lived in

25 Mexico City. Asthma severity ranged from mild to severe,

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1 although most of the children fell in the mild to moderate

2 range. Each child was tested for type of GSTM one and

3 GSTP one and was followed for 12 weeks. The children's

4 parents kept a daily diary of respiratory symptoms and

5 bronchodilator use and the children performed lung

6 function tests twice a week at a clinic.

7 --o0o--

8 MS. DRECHSLER: The results showed that for

9 children with the active forms of GSTM one and GSTP one,

10 there were no associations between ambient ozone and

11 cough, breathing difficulty, or bronchodilator use. This

12 suggests that people who have the active forms of these

13 two genes are protected again adverse effects related to

14 ozone exposure. However, for children with the in active

15 form of GSTM one, ozone was significantly associated with

16 breathing difficulty, whether exposure was on the previous

17 day or was an average of the previous two or six days.

18 In children with the less active form of

19 GSTP one, ozone exposure was associated with cough,

20 difficulty breathing, and bronchodilator use, particularly

21 when exposure was averaged over several previous days.

22 --o0o--

23 MS. DRECHSLER: As you can see from this figure,

24 children who had both the inactive form of GSTM one and

25 the less active form of GSTP one, shown in yellow bar, had

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1 the greatest risk of experiencing difficulty breathing

2 with ozone exposure compared to children having only the

3 inactive form of either gene.

4 In addition, as you can see from the slide, risk

5 of experiencing breathing difficulty increased as the

6 ozone averaging time lengthened from one to two and six

7 previous days.

8 Also, as you can see in the chart, the trend in

9 risk associated with having both alternate gene forms was

10 greater than that observed for children who had only one

11 of inactive variant

12 --o0o--

13 MS. DRECHSLER: You may be wondering how many

14 people have the GSTM one and GSTP one types associated

15 with greater risk of ozone-related symptoms. This slide

16 shows the percentage of white and Hispanic children in one

17 of the children's health study cohorts who had the active

18 forms of both genes in blue, the inactive form of GSTM one

19 or the less active form of GSTP one in burgundy, and both

20 the inactive form and less active form of the other two

21 genes in yellow.

22 For comparison, 38 percent of the children in the

23 study we are presenting today have the inactive form of

24 GSTM one, while 36 percent have the less active form of

25 GSTP one and 14 percent had both.

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1 --o0o--

2 MS. DRECHSLER: These results suggest that

3 genetics plays a role in sensitivity to ozone and that

4 asthmatics and likely non-asthmatics as well as who have

5 genetic variants that provide less effective defenses are

6 at increased risk of experiencing adverse effects when

7 exposed to ozone. This implies that we may need to

8 reconsider how we think about susceptibility to air

9 pollution because these results, and those from other

10 studies, suggest that susceptibility incorporates more

11 than just baseline health status. For example, whether or

12 not a person has a chronic health problem such as asthma.

13 The results discussed today begin to address the

14 question of how ozone harms human health. The Board is

15 also concerned with this fundamental question and is

16 currently funding a controlled human exposure study

17 investigating the influence of variants in GSTM one and

18 GSTP one on ozone induced responses of adult asthmatics.

19 The authors of the paper presented this morning

20 are continuing to investigate the influence of these

21 variants, as are other investigators. In addition,

22 several researchers are beginning to look at the roles of

23 several other gene variants in susceptibility to ozone

24 induced health effects.

25 Thank you for your attention. We would be

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1 pleased to answer any questions you may have.

2 CHAIRPERSON SAWYER: Thank you, Dr. Drechsler.

3 Do Board members have any questions?

4 Dr. Gong.

5 BOARD MEMBER GONG: Yes, thank you. Very nice

6 presentation.

7 I am really excited about the genetic

8 investigations being undertaken in air pollution research,

9 as well as in the rest of medicine. I would just start

10 that with that.

11 But I have one specific question. You showed the

12 slide of the Children's Health Study and the risk levels.

13 Whites and Hispanics, I believe. Are the risks of the

14 symptoms and lung function decrements also seen in

15 non-asthmatic children who have these genetic

16 polymorphisms?

17 MS. DRECHSLER: The authors of the Children's

18 Health Study have not yet published an analysis of the

19 genetic contribution to air pollution exposure. They did

20 genotype about 2000 children from one of the cohorts. But

21 to date, the only papers that have used that information

22 are related to susceptibility to respiratory infections

23 and environmental tobacco smoke.

24 BOARD MEMBER GONG: I think the implication is if

25 these genetic polymorphisms pertain to asthmatic children,

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1 do they also pertain to non-asthmatic children? And

2 perhaps that's why we may see symptoms and lung function

3 changes, et cetera, in that particular larger group of

4 individuals who are exposed.

5 And a op-ed comment is that whereas, these

6 studies of genetic susceptibility are very important,

7 treating and potentially very useful in diagnosis and

8 management of asthma and managing ambient air pollution,

9 unfortunately we can't -- we can't choose our parents or

10 our genetics. So it's still very vital and critical for

11 us as individuals and as groups and organizations to try

12 to seek to have healthier air as well. Because that's

13 what they're exposed to. You can have the worst genetic

14 susceptibilities, but if you're never exposed to the bad

15 air, you may not express that problem.

16 But again, we know we have the worst air in the

17 country. So I'm glad we're moving ahead with both the

18 genetic and environmental parts of this.

19 Thank you.

20 CHAIRPERSON SAWYER: Are there any other comments

21 from Board members or questions? If not, thank you very

22 much.

23 DR. DRECHSLER: Thank you.

24 CHAIRPERSON SAWYER: All right. I have no

25 witnesses who wish to speak on this item. So we'll go to

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1 Agenda Item 7-7-2, consideration of four research

2 proposals.

3 Staff, please introduce this item.

4 MS. DRECHSLER: Good morning, Dr. Sawyer -- you

5 meant me, right?

6 CHAIRPERSON SAWYER: Dr. Drechsler.

7 (Thereupon an overhead presentation was

8 presented as follows.)

9 MS. DRECHSLER: Yes. Okay. Good morning, Dr.

10 Sawyer and members of the Board.

11 We have four research proposals for you to

12 consider this morning. I will briefly describe the

13 objective and expected results for each.

14 Executive Order S-305 requires that the

15 California Environmental Protection Agency coordinate the

16 efforts of multiple state agencies.

17 --o0o--

18 MS. DRECHSLER: Coordinate the efforts of

19 multiple state agencies to produce science reports every

20 two years on the potential impacts of global warming on

21 various sectors of the California economy. The Air

22 Resources Board was assigned to lead the analysis of

23 public health impacts of climate change. First report

24 under this executive order was released in 2006 and it

25 included an analysis of the risk of heat-related deaths in

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1 the five most populous areas of California.

2 The first project I'm presenting this morning is

3 by the same group of investigators who performed the

4 analysis for the 2006 report. It will expand on the

5 previous analysis, including methodological development

6 and extend the analysis to two additional cities.

7 The objectives are to estimate potential changes

8 in oppressive air mass events through the end of this

9 century under several scenarios of climate change. To

10 translate these changes into potential impacts on

11 heat-related death in California, stratified by urban

12 center and age group, and to assess the expected

13 adaptation potential of the population in each city to

14 these changing conditions.

15 The final products of this study will contribute

16 to the 2008 report to the Governor and will include

17 estimates of heat-related deaths across California's seven

18 largest metropolitan areas through the year 2100, both

19 with and without acclimatization. And estimates of the

20 number of actual heat warnings that would be called by an

21 operational heat watch warning system.

22 --o0o--

23 MS. DRECHSLER: The next project, Effective

24 GSTM one Genotype on Ozone Induced Allergic airway

25 Inflammation, was originally funded in 2004 and included

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1 one experiment designed to investigate three objectives.

2 First, whether ozone exposure enhances specific

3 lower airway inflammatory responses of asthmatic subjects

4 during late phase reactions to inhaled allergen.

5 Second, to determine whether the GSTM one variant

6 genotype is an important predictor of susceptibility of

7 asthmatic subjects to develop enhanced late phase

8 reactions to allergen challenge after ozone exposure.

9 And third, to determine whether preexposure to

10 allergen enhances the subsequent inflammatory responses to

11 ozone exposure.

12 The UC San Francisco Human Subjects Committee

13 would not approve the protocol as originally funding

14 because of the number of bronchoscopies per subject.

15 Staff proposes to address this issue by splitting the

16 project into two independent studies, each with a

17 different group of subjects and augmenting the moneys of

18 the original contract to maintain the original intent of

19 the project.

20 The results of the study will help to better

21 characterize the susceptibility of asthmatics to ozone

22 exposure, clarify whether ozone enhances allergen induced

23 airway inflammation and help to explain the wide

24 variability in responses of asthmatics to ozone.

25 --o0o--

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1 MS. DRECHSLER: The second project is

2 cardiovascular health effects of fine and ultra fine

3 particles during freeway travel. Researchers at the

4 University of California, Los Angeles, and Los Amigos

5 Research and Education Institute are currently conducting

6 a study of fine and ultra fine particle exposure on the

7 405 and 710 freeways in Los Angeles. Sixteen healthy

8 elderly subjects are undergoing a series of two-hour

9 exposures to freeway atmospheres, including particle

10 filtered freeway air and unfiltered freeway air.

11 This augmentation will add two subjects to the

12 existing project. These subjects will undergo the same

13 exposures as the original group. The project will

14 potentially provide two kind of important data to ARB.

15 First, information on the effects of ultra fine

16 particles on measures of cardiac function such as heart

17 rate variability and blood markers of systemic

18 inflammation which are thought to aggravate cardiovascular

19 disease. And, second, more information about the nature

20 of pollutant exposure during freeway travel. The addition

21 of three subjects will increase statistical power and

22 improve the likelihood of significant findings.

23 --o0o--

24 MS. DRECHSLER: Central to any climate study of

25 change and identification of greenhouse gas mitigation

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1 strategies is the development of an emissions inventory

2 that identifies and quantifies the primary anthropogenic

3 sources of greenhouse gas emissions.

4 On the next study, improving the carbon dioxide

5 emission estimates from the combustion of fossil fuels in

6 California will address that issue. Fossil fuel

7 combustion accounts for 98 percent of gross California

8 carbon dioxide emissions. And while carbon dioxide

9 emissions are relatively well characterized at the state

10 level, no estimates exist at the more disaggregated

11 spatial level.

12 This study will augment a current ARB research

13 contract for improving the carbon dioxide emission

14 estimates by developing a disaggregated estimate of

15 energy-related carbon dioxide emissions. Better

16 understanding the carbon dioxide emission inventory,

17 finding ways of validating the inventory on a

18 sector-by-sector basis, and providing a validation

19 approach to the statewide greenhouse gas emission

20 inventory through disaggregation are important for

21 building AB 32 greenhouse gas emission inventory baselines

22 and projections.

23 This project will provide disaggregated

24 information on these emissions based on available data

25 which can then be evaluated using information from local

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1 sources.

2 --o0o--

3 MS. DRECHSLER: This concludes the presentation.

4 We recommend that you approve these research proposals and

5 we'll be happy the answer any questions you may have.

6 CHAIRPERSON SAWYER: Thank you, Dr. Drechsler.

7 Dr. Gong, do you want to make a statement about

8 recusing yourself from one of those items.

9 BOARD MEMBER GONG: Yes, thank you, Mr. Chairman.

10 This is a recusal statement.

11 I would like to advise the Board that I will

12 recuse myself from the discussion and consideration of and

13 the vote on research proposal 2628-256, Cardiovascular

14 Health Events of Fine and Ultra Fine Particles During

15 Freeway Travel. I do so because of affiliation with Los

16 Amigos Research and Education Institute, which will be a

17 subcontractor on this project if their proposal is

18 approved by the Board in this resolution.

19 Thank you.

20 CHAIRPERSON SAWYER: Thank you.

21 Do Board members have any questions?

22 Dr. Gong. Or comments.

23 BOARD MEMBER GONG: Just a comment. A general

24 comment.

25 I think it was already stated that one of the

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1 proposals had the Institutional Review Board actually has

2 some hesitation or reluctance to approve one of their

3 proposals. And I think, just for the Board's benefit, any

4 studies involving human participation, and even animal

5 participation, need to go before a research committee,

6 peers, at that particulate institution, and I'm glad to

7 see that the system works in this regard. And even though

8 the IRB there denied it initially, there were ways to

9 modify the protocol and bring it forth to fruition,

10 hopefully.

11 That's my statement. Thank you.

12 CHAIRPERSON SAWYER: Thank you, Dr. Gong.

13 Are there any other comments from Board members.

14 A reminder to Board members of our policy

15 concerning ex parte communications. While we may

16 communicate off the record with with outside persons

17 regarding Board rulemaking, we must disclose the names of

18 our contacts and the nature of the contents on the record.

19 This requirement applies specifically to communications

20 which take place after the public agenda of the Board

21 hearing has been published.

22 Are there any communications that you need to

23 disclose.

24 Dr. Gong?

25 BOARD MEMBER GONG: No.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234519

1 BOARD MEMBER BERG: No.

2 SUPERVISOR HILL: No.

3 CHAIRPERSON SAWYER: Supervisor? No.

4 SUPERVISOR CASE: No.

5 CHAIRPERSON SAWYER: No. All right.

6 Have all of the members of the Board had an

7 opportunity to review the proposals.

8 Are there any additional concerns or comments?

9 If not, do I have a motion to adopt Resolutions

10 7-22, 7-23, and 7-30? And then the one which Dr. Gong is

11 recusing himself from, we'll vote on separately.

12 SUPERVISOR HILL: I'll move the resolution.

13 CHAIRPERSON SAWYER: Second.

14 SUPERVISOR CASE: Second.

15 CHAIRPERSON SAWYER: All in favor, please

16 indicate by saying Aye.

17 (Ayes)

18 CHAIRPERSON SAWYER: Opposed?

19 (Nays)

20 CHAIRPERSON SAWYER: These three resolutions are

21 carried.

22 All right. Do I have a motion to adopt

23 Resolution 7-24?

24 BOARD MEMBER BERG: So moved.

25 SUPERVISOR HILL: Second.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234520

1 BOARD MEMBER RIORDAN: Second.

2 CHAIRPERSON SAWYER: Would the clerk please call

3 the roll.

4 SECRETARY ANDREONI: Ms. Berg?

5 BOARD MEMBER BERG: Aye.

6 SECRETARY ANDREONI: Supervisor Case?

7 BOARD MEMBER CASE: Aye.

8 SECRETARY ANDREONI: Ms. D'Adamo?

9 BOARD MEMBER D'ADAMO: Aye.

10 SECRETARY ANDREONI: Supervisor Hill?

11 SUPERVISOR HILL: Aye.

12 SECRETARY ANDREONI: Ms. Kennard?

13 BOARD MEMBER KENNARD: Aye.

14 SECRETARY ANDREONI: Ms. Riordan?

15 BOARD MEMBER RIORDAN: Aye.

16 SECRETARY ANDREONI: Supervisor Roberts?

17 BOARD MEMBER ROBERTS: Aye.

18 SECRETARY ANDREONI: Professor Sperling?

19 BOARD MEMBER SPERLING: Aye.

20 SECRETARY ANDREONI: Chairman Sawyer?

21 CHAIRPERSON SAWYER: Aye.

22 SECRETARY ANDREONI: Motion passes.

23 CHAIRPERSON SAWYER: Thank you. Since this is

24 not a regulatory item, it is not necessary to officially

25 close the record.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234521

1 Agenda Item 7-7-3, an informational update on the

2 Intergovernmental Panel on Climate Changes, Fourth

3 Assessment Report, published last month. It is important

4 for the Board to stay current on climate change science so

5 we can make the possible decisions. Staff will provide

6 the Board with a biannual, with biannual updates on new

7 scientific findings.

8 Ms. Witherspoon, please introduce this item.

9 EXECUTIVE OFFICER WITHERSPOON: Thank you,

10 Dr. Sawyer. Today, staff will present an overview on the

11 physical science of climate change, its impacts,

12 mitigation efforts, and adaptation opportunities as

13 summarized in the Fourth Assessment of the

14 Intergovernmental Panel on Climate Change. Dr. Nehzat

15 Motallebi of the Research Division will give the staff

16 presentation.

17 (Thereupon an overhead presentation was

18 presented as follows.)

19 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: Thank

20 you, Ms. Witherspoon. Good morning, Dr. Sawyer and

21 members of the Board.

22 In today's update, we will present key scientific

23 findings on climate change by science published by the

24 Intergovernmental Panel of Climate Change, or IPCC for

25 short.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234522

1 --o0o--

2 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: The

3 Intergovernmental Panel on Climate Change was established

4 in 1988 by the World Meteorological Organization and the

5 United Nations Environmental Program in recognition of the

6 problem of global warming. Through the IPCC, climate

7 experts from around the world synthesize the most recent

8 climate science findings every five to seven years. The

9 IPCC has issued comprehensive assessments in 1990, 1996,

10 and 2001; its Fourth Assessment Report is being released

11 in sections this year.

12 The IPCC has three working groups that deal with

13 scientific basis of global warming, its consequences, and

14 options for slowing the warming trend. For each working

15 group, the IPCC has released Summary for Policymakers.

16 The final report that synthesizes the result of

17 the overall effort will be released at the end of this

18 year.

19 --o0o--

20 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: The

21 IPCC Fourth assessment reports are the most comprehensive

22 synthesis of climate change science to date, which

23 includes the input of more than 1200 leading and

24 contributing authors, and 2500 scientific expert reviewers

25 from more than 130 countries.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234523

1 The summary for policymakers is written by the

2 working group's lead authors reviewed in two stages by

3 technical experts, and finally approved by government

4 representatives before being released. California climate

5 scientists are closely involved in writing the report.

6 Several researchers from California institutions and

7 National Lab are represented as main authors.

8 --o0o--

9 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: While

10 the Fourth Assessment represents worldwide scientific

11 consensus, it does have some limitation.

12 For example, the end of 2005 was essentially the

13 cut-off date for the inclusion of new research. Thus,

14 important findings published since 2005, such as increased

15 Greenland ice melt, and the relationship between sea

16 surface temperature and hurricane intensity, were not

17 included. One extremely important limitation is that

18 estimates of sea level rise do not include the full

19 possible future effects of contributions from melting of

20 Greenland's ice cap.

21 Policymakers would like to know the possible

22 impacts of different scenarios for the next 10 to

23 20 years. Current global climate models cannot

24 differentiate impacts over shorter time frames with the

25 high confidence level that they do have for 50 or hundred

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234524

1 year projections. Also an interval of the six years

2 between the Assessments is too long for the policymakers

3 to be able to benefit from the most current research.

4 There is a need for more frequent brief reports on the

5 state of the science.

6 --o0o--

7 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: After

8 assessing decades of sophisticated climate data recorded

9 everywhere from the depth of the ocean to tens of miles

10 above the Earth's surface, leading scientists from around

11 the world have reported major advances in our

12 understanding of climate change.

13 The report concludes that it is "unequivocal"

14 that Earth's climate is warming, and that emissions of

15 heat-trapping gases from human activities have caused

16 "most of the observed increase in globally averaged

17 temperatures since the mid-20th century."

18 --o0o--

19 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: This

20 graph shows carbon dioxide concentrations for the last

21 10,000 years. For most of this period, carbon dioxide

22 concentrations stayed well below 300 parts per million

23 until the significant rise on the right.

24 If you look at the expanded area in the smaller

25 graph, the increase corresponds to the period between 1750

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234525

1 to the present. In 1750, near the beginning of the in

2 Industrial Revolution, atmospheric carbon dioxide was

3 about 280 parts per million.

4 Levels increased relatively slowly until second

5 half of the 20th century when accelerated. The graph

6 slows no slow down and most recent data suggests that

7 carbon dioxide growth rates emissions have increased since

8 the 1990's. Other greenhouse gases such as methane and

9 nitrous oxide also show very similar behavior.

10 --o0o--

11 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: The

12 IPCC concludes that it is "unequivocal" that Earth's

13 climate is warming "as is now evident from observations of

14 increases in global average air and ocean temperatures,

15 rising global mean sea level, and widespread melting of

16 snow and ice.

17 The information that the temperatures and sea

18 level have risen not new. What is new is the decease in

19 uncertainty in their global estimates. The shaded blue

20 area in these figures are the estimated uncertainty.

21 Notice how narrow the blue area is and how the warming and

22 rising sea level trends are clearly much greater than the

23 uncertainty, particularly for the last 50 years.

24 --o0o--

25 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: North

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234526

1 America temperature changes for the past hundred years

2 show the relative importance of the human-induced effects

3 over and above the natural variability.

4 The blue region represents the expected

5 temperature variation due to natural drivers. The pink

6 shaded area shows the climate model results when both

7 human-induced warming effects and natural variability are

8 included. These combined effects show a substantial match

9 with the observed temperature.

10 --o0o--

11 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: This

12 is true for every continent on the earth and for the

13 global ocean. The ability of the coupled climate model to

14 simulate the observed temperature evolution on each of the

15 six continents provides much stronger evidence of human

16 influence on climate than was available in the Third

17 Assessment Report.

18 --o0o--

19 STAFF AIR POLLUTION SPECIALIST MOTALLEBI:

20 Additional IPCC findings are on the relationship between

21 observed climate change and recent observed changes in

22 natural and human environment.

23 The statements quoted in this slide are based

24 largely on the data sets that cover the period since 1970.

25 The quality of the data sets has improved significantly,

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234527

1 and the recent studies have allowed a broader and more

2 confident assessment on the relationship between observed

3 warming and impacts that were made in the Third

4 Assessment.

5 A global assessment of data since 1970 has shown

6 it is likely that anthropogenic warming has had a distinct

7 influence on many physical and biological systems.

8 The Fourth Assessment concluded that "there is a

9 strong confidence that the recent regional changes in

10 temperature have had discernable impacts on many physical

11 and biological systems."

12 --o0o--

13 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: Each

14 of the effects of the human-induced climate change are now

15 apparent on every continent.

16 A global synthesis of the studies in this

17 Assessment strongly demonstrate that the spatial agreement

18 between regions of significant warming across the globe

19 and the location of the significant observed changes in

20 many systems is consistent with warming, but very unlikely

21 due solely to natural variability of temperatures or

22 natural variability of the systems.

23 A few examples include: Effect of the

24 temperature increases have been documented in heat-related

25 death in Europe. Increasing avalanches in mountain

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234528

1 regions. Amazon suffers from drought. Increased run-off

2 and earlier spring peak discharge in many

3 glacier-and-snow-fed rivers. Flooding in populated

4 mega-delta regions.

5 --o0o--

6 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: More

7 specific information is now available across a wide range

8 of the systems and regions concerning the nature of future

9 impacts.

10 Worldwide temperatures have increased about .7

11 degrees Centigrade since beginning of the Industrial

12 Revolution. Even if emissions were stopped today,

13 additional warming is inevitable because of the greenhouse

14 gases already in the system. Two years ago, the Governor

15 set a target of an 80 percent reduction below 1990

16 emission levels by 2050. If adopted worldwide, global

17 warming would be limited to one or two degrees Centigrade

18 above 1980 to 1999 levels as shown here. Even this lower

19 temperature scenario results in some impact from climate

20 change. For example, hundreds of millions of people are

21 projected to be exposed to increased water stress, which

22 will worsen with increasing temperatures. At lower

23 latitudes, especially dry and tropical regions, crop

24 productivity is projected to decrease for even a small

25 local temperature increases, which would increase the risk

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234529

1 of hunger.

2 The next three slides show more examples of

3 global impacts projected for climate changes associated

4 with increasing temperature.

5 --o0o--

6 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: With

7 relatively low temperature increase of two to three

8 degrees Centigrade, millions more people could experience

9 coastal flooding each year.

10 The IPCC projects North American impacts that are

11 particularly troubling for California: "Warming in

12 western mountains is projected to cause decreased

13 snowpack, more winter flooding, and reduced summer flows,

14 worsening the already sharp competition for over-allocated

15 water resources."

16 --o0o--

17 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: With a

18 moderate temperature increase of three to four degrees

19 Centigrade, substantial melting of the Greenland ice cap,

20 and possibly the West Antarctic ice sheet, would occur

21 over centuries to millennia for a global average sea level

22 rise of four to six meters or more.

23 --o0o--

24 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: With a

25 higher predicted temperature increase of four to five

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234530

1 degrees Centigrade which corresponds to the carbon dioxide

2 emissions if human beings follow the business-as-usual

3 course, continuing to exploit fossil fuel resources

4 without reducing carbon emissions, the eventual effects on

5 climate and life may be comparable to those at the time of

6 the mass species extinctions.

7 --o0o--

8 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: Most

9 of the climate change impacts discussed so far are

10 preventable with appropriate action. In the U.S., for

11 example, some cities, such as New York City, Chicago,

12 St. Louis, have adopted heat emergency action plans that

13 combine public announcements through the media of

14 impending high heat with transportation to the cooling

15 center for the at-risk individuals.

16 However, adaptation alone is not expected to cope

17 with all the protected effects of climate change, and

18 especially not over the long run as most impacts increase

19 in magnitude. Although many early impacts of climate

20 change can be effectively addressed through adaptation,

21 the options for successful adaptions diminish and

22 associated costs increase with increasing climate change.

23 And relatively undeveloped countries are not

24 prepared to handle climate change impacts and will suffer

25 greatly.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234531

1 --o0o--

2 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: The

3 latest international report on mitigation of the climate

4 change was released last month. The message in the report

5 is clear: Many options to control greenhouse gas

6 emissions are available; however, governments must act

7 quickly to slow warming and avoid significant disaster.

8 --o0o--

9 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: Global

10 greenhouse gas emissions have grown since pre-industrial

11 times, with a 70 percent increase between 1970 and 2004.

12 With current climate change mitigation policies and

13 related sustainable development practices, global

14 greenhouse gas emissions will continue to agree over the

15 next few decades, unless we take immediate actions.

16 --o0o--

17 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: This

18 slide details the costs of the greenhouse gas mitigation,

19 expressed in terms of reduced global output or global GDP.

20 Clearly, the costs of mitigation will increase as

21 stabilization targets are reduced. For example, it has

22 been estimated that achieving a stabilization level of 445

23 to 535 ppm CO2-equivalent, which would equate to the

24 temperature increase of 2 to 2.8 degrees Centigrade, could

25 reduce product by about three percent in 2030 or about .12

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234532

1 percent decrease per year.

2 In this report, options with negative cost effect

3 are defined as those options whose benefits such as

4 reduced energy costs and reduced emissions of the

5 pollutants equal or exceed their costs to society.

6 --o0o--

7 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: The

8 most effective policy mix will vary from country to

9 country. If integrated with the government policies,

10 climate change policies can provide to sustainable

11 development practices in both developed and developing

12 countries.

13 The developed world is responsible for majority

14 of emissions today, while the developing country, "the

15 major emerging economies," will "represent most of the

16 growth of emissions in the coming decade or so, and it

17 underscores the need for collective action."

18 --o0o--

19 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: It is

20 now apparent that the increasing atmospheric concentration

21 of greenhouse gases, resulting from human activities, is

22 changing the climate in ways that pose serious risks to

23 California's health, economy, and environment.

24 Governor Schwarzenegger's Executive Order of June

25 2005, called for specific emission reductions and a

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234533

1 periodic update on the state of climate change science and

2 the emerging understanding of potential impacts on

3 climate-sensitive sectors such as the state's water

4 supply, public health, agriculture, coastal areas, and

5 forestry. The Executive Order also called for the

6 California Environmental Protection Agency to prepare

7 biennial science reports on the potential impact of

8 continued global warming on California. We have given you

9 a brochure on the 2006 report, and the next report is due

10 in late 2008.

11 --o0o--

12 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: I

13 would like to close with the key conclusion of the IPCC

14 report. The report finds that it is "very likely" that

15 emissions of the heat-trapping gases from human activities

16 have caused "most of the observed increases in globally

17 averaged temperatures since the mid-20th century."

18 Adaptation will be more challenging in developing

19 countries than in developed countries, due to constraints

20 on adaptive capacity. For example, new studies confirm

21 that Africa is one of the most vulnerable continents to

22 climate change because of multiple stresses and low

23 adaptive capacity. Some adaptation to current climate

24 variability is taking place, however, this may be

25 insufficient for future changes in climate.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234534

1 A wide variety of national policies and

2 instruments are available to governments to create the

3 incentives for mitigation action.

4 --o0o--

5 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: This

6 concludes my presentation. And we would be happy to

7 answer any questions.

8 Thank you.

9 CHAIRPERSON SAWYER: Thank you very much.

10 Do Board members have any questions?

11 Ms. D'Adamo.

12 BOARD MEMBER D'ADAMO: That was a very useful

13 report. Thank you. And in particular, the, our changing

14 climate assessing the risks to California. Just wondering

15 if there are plans to take this to the next step in terms

16 of economic impacts?

17 RESEARCH DIVISION CHIEF CROES: Yes. The report

18 that's due in late 2008 will have, include an economic

19 assessment of the impacts of climate changes are

20 unmitigated, so they can be compared to the costs of

21 mitigation.

22 BOARD MEMBER D'ADAMO: Thank you.

23 CHAIRPERSON SAWYER: Are there any other

24 questions?

25 BOARD MEMBER GONG: Yes.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234535

1 CHAIRPERSON SAWYER: Dr. Gong.

2 BOARD MEMBER GONG: That was a very sobering

3 report. Colorful, but very sobering. And I think the

4 data is overwhelming that we have an issue there. A

5 global issue. And I was just wondering when is our --

6 does the Board receive periodic reports on global warming

7 like this or this is because the IPCC, but updates?

8 RESEARCH DIVISION CHIEF CROES: We plan to give

9 the Board briefings every six months, so every June and

10 December. But there's an overwhelming amount of

11 information that's coming out, so I think we would also

12 plan to give you quarterly written updates as well.

13 BOARD MEMBER GONG: Excellent.

14 Just as a side note, perhaps in future reports

15 you could add some positive examples of how we've

16 succeeded. Not necessarily here in California, but maybe

17 in some small city somewhere in the United States or even

18 in the world. Just to give us some glimmer, burst of

19 optimism, because, again, you paint a very sobering

20 picture, realistic, sobering, whatever you want to call

21 it, but I'd like the hear some good news. Bring me some

22 good news.

23 RESEARCH DIVISION CHIEF CROES: Okay, that's a

24 good point. We're we actually surveying what's going on

25 around the world in terms of --

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234536

1 BOARD MEMBER GONG: Excellent.

2 RESEARCH DIVISION CHIEF CROES: -- reducing --

3 BOARD MEMBER GONG: It doesn't have to be a long

4 litany of examples, but just some glimpses of how other

5 people are handling this, how we're saving, you know, the

6 situation. Thank you.

7 BOARD MEMBER CASE: Just a question. I would

8 agree, it's a very sobering in report. In looking at your

9 slides, there's one that shows the changes in

10 heat-trapping gasses that looks for the past 100 years.

11 And right at the end towards the year 2000, there's just a

12 huge increase. Is it expected that there's going to

13 continue to be an exponential increase if something is not

14 done? When you look at this, it's a fairly level amount

15 that's rising slowly until you get really close to 2000

16 and it rises, it just spikes straight up.

17 STAFF AIR POLLUTION SPECIALIST MOTALLEBI: If no

18 action is done, it's expected to rise as drastic as it

19 shows and it is strongly supported by both observation and

20 climate model prediction as well, too, unfortunately.

21 BOARD MEMBER CASE: Thank you. It really is

22 sobering.

23 CHAIRPERSON SAWYER: Okay. Thank you very much.

24 I have a single witness who wishes to speak.

25 Rachel McMahon.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234537

1 Or maybe it was the wrong item that you signed up

2 for, is that --

3 MS. MCMAHON: Wrong item.

4 CHAIRPERSON SAWYER: Okay. Fine. Sign up for

5 right one. And we'll look forward to hearing from you a

6 little bit later in the day.

7 Does staff have any further comments?

8 Ms. Witherspoon?

9 EXECUTIVE OFFICER WITHERSPOON: Nothing at this

10 time.

11 CHAIRPERSON SAWYER: Since this is not a

12 regulatory item, it is not necessary to officially close

13 the record.

14 Agenda Item 7-7-4, Consideration of Early Action

15 Measures to Mitigate Climate Change in California.

16 The Global Warming Solutions Act requires the Air

17 Resources Board to approve a list of discrete early action

18 measures which can be adopted as regulations and made

19 enforceable no later than January 1st, 2010.

20 At the same time period, the Air Resources Board

21 must complete its comprehensive strategy for achieving the

22 2020 greenhouse gas reductions target and to begin

23 implementation.

24 Staff has been considering all of the options and

25 will present its recommendations and analysis today

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234538

1 regarding early action measures.

2 Immediately following the staff's presentation,

3 the Board will hear a 15-minute presentation by Angela

4 Johnson-Meszaros, Co-chair of the Global Warming

5 Environmental Justice Advisory Committee. This Committee

6 was established in statute to advise us on the

7 comprehensive scoping plan and other relevant subjects.

8 Following Ms. Johnson-Meszaros' presentation, we

9 will take Board member questions and then hear witnesses

10 who have signed up to speak.

11 Ms. Witherspoon, please introduce this item.

12 EXECUTIVE OFFICER WITHERSPOON: Thank you,

13 Dr. Sawyer.

14 As you indicated, the Board must identity a list

15 of discrete early action greenhouse gas reductions

16 measures by June 30th, 2007. Once on the list, these

17 measures need to be developed into regulatory proposals

18 brought to the Board for adoption approximately by the end

19 of next year and made enforceable by January 1, 2010.

20 It is an incredibly tight timetable considering

21 that most ARB regulations are developed over a period of

22 three years or more.

23 The law also requires the Board to find that the

24 proposed regulations are technologically feasible and cost

25 effective, prior to their actual adoption, and this

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234539

1 mandate includes early action measures.

2 It is too early in the process to make that legal

3 finding today. So staff is proposing that you, instead,

4 make a presumption and hold your actual finding of cost

5 effectiveness and technological feasibility in abeyance

6 until we return to you with final regulatory language and

7 a factual analysis of each rule.

8 As you soon see, the staff recommendations are

9 much more extensive than the narrow definition of early

10 actions in the law. As part of the stakeholder process,

11 we have identified many additional opportunities for

12 reducing greenhouse gas emissions and believe the Board

13 should commit to developing these strategies into final

14 proposals as quickly as possible.

15 Michael Robert from the Research Division's

16 Climate Change Mitigation and Science branch will make the

17 staff presentation.

18 Michael.

19 (Thereupon an overhead presentation was

20 presented as follows.)

21 AIR RESOURCES ENGINEER ROBERT: Thank you,

22 Ms. Witherspoon, and good morning, Dr. Sawyer and members

23 of the Board.

24 Today, staff is bringing you our recommendations

25 for discrete early action measures pursuant to the Global

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234540

1 Warming Solutions Act of 2006 or Assembly Bill 32. Early

2 actions are the first part of a large portfolio of actions

3 that are needed to restore California greenhouse gas

4 emissions to 1990 levels by the year 2020.

5 --o0o--

6 AIR RESOURCES ENGINEER ROBERT: In total, we are

7 recommending that development of 37 distinct measures be

8 initiated to lower greenhouse gas emissions in the near

9 term.

10 EXECUTIVE OFFICER WITHERSPOON: Back one slide,

11 please.

12 Back one slide.

13 Oh, there it is.

14 AIR RESOURCES ENGINEER ROBERT: Thank you.

15 --o0o--

16 AIR RESOURCES ENGINEER ROBERT: Three of these

17 measures can be adopted in time to meet the AB 32 legal

18 definition of discrete early actions. Twenty-three of the

19 measures have clear climate and we plan to implement them

20 in the 2007 to 2012 time frame. The final set of 11

21 measures include rulemakings ARB is already pursing for

22 diesel particulate and ozone control that could have

23 important climate co-benefits.

24 Staff estimates that the benefit of these early

25 actions is at least 33 megatons of carbon dioxide

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234541

1 equivalent emission reductions or roughly 20 percent of

2 what is needed to meet the AB 32 goal in 2020. In

3 addition, our partners on the interagency Climate Action

4 Team are pursuing their own early actions which will

5 achieve additional greenhouse gas reductions in the near

6 term.

7 Approving the staff's proposal will put us well

8 on a path towards achieving significant early reductions

9 while building a solid foundation for the scoping plan and

10 beyond.

11 --o0o--

12 AIR RESOURCES ENGINEER ROBERT: To achieve

13 California's greenhouse gas emissions reduction targets,

14 the Board is empowered to use traditional

15 performance-based control methods. AB 32 also provides

16 the flexibility to design, adopt, and implement

17 market-based compliance mechanisms while the full planning

18 process is underway. AB 32 recognizes that immediate

19 progress in reducing emissions can and should be made.

20 Accordingly, ARB must select a list of discrete early

21 action greenhouse gas reduction measures by June 30, 2007.

22 All such measures are to be developed into regulatory

23 proposals, to be adopted by the Board and made enforceable

24 by January 1st, 2010.

25 It should be noted that this schedule is very

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234542

1 accelerated compared to most ARB regulations. The staff's

2 rule of thumb is that a new regulation takes three years

3 from initial idea to Board hearing. Under AB 32, we have

4 just 18 months to bring early action rules to the Board.

5 As will be discussed, the practicality of being able to

6 fully develop a measure into a regulation by January 1st,

7 2010 was the primary criterion for determining what went

8 on the early action list, with the second most important

9 criterion being how much tons we could achieve from each

10 measure.

11 It should also be noted AB 32 establishes several

12 criteria for every greenhouse gas regulation adopted by

13 the Board, including early action measures. Like all

14 other rules, they must be technologically feasible and

15 cost-effective. In addition, greenhouse gas reduction

16 measures must not interfere with public health protection

17 in any way, in terms of increasing criteria pollutant

18 emissions or toxic air contaminants. There are also

19 environmental justice criteria in the law with respect to

20 avoiding disproportionate impacts.

21 --o0o--

22 AIR RESOURCES ENGINEER ROBERT: The path to

23 today's Board hearing started right after AB 32 became

24 law. At the first public workshop in January, staff

25 discussed the process for identifying and selecting early

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234543

1 actions. In March, we held an international symposium to

2 explore near-term solutions that have worked elsewhere in

3 the world. In April, a brief staff report summarized all

4 the information received to date. A second public

5 workshop was held on April 23rd. At that time, we

6 identified 36 measures for further ARB development and

7 referred many more to our sister agencies for evaluation.

8 As requested, we have also posted all stakeholder comments

9 received by staff on our website.

10 While ARB was conducting the process outlined on

11 this slide, the interagency Climate Action Team released

12 its own companion report on early actions to be undertaken

13 by other state agencies. The Climate Action Team will be

14 discussing that report at a public workshop next Monday in

15 Sacramento.

16 --o0o--

17 AIR RESOURCES ENGINEER ROBERT: AB 32 creates a

18 comprehensive, multi-year program to reduce greenhouse gas

19 emissions in California, with the overall goal of

20 restoring emissions to 1990 levels by the year 2020. The

21 next few slides illustrate where early action measures fit

22 into the overall timetable.

23 By the end of this year, 2007, ARB must confirm

24 the statewide 1990 emissions inventory, thereby locking in

25 the 2020 target. Also this year, ARB must adopt mandatory

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234544

1 emission reporting regulations. Both of those items will

2 be before the Board at its December meeting. Concurrently

3 we will need to hire and organization the more than 100

4 staff we will need to complete the new workload that is

5 mandated by AB 32.

6 --o0o--

7 AIR RESOURCES ENGINEER ROBERT: Next year, staff

8 will bring you the regulatory measures to implement

9 whatever discrete early action measures you decide upon

10 today. For example, we are planning to have the Low

11 Carbon Fuel Standard to you for adoption at the December

12 meeting.

13 Next year, we will also have to complete a

14 comprehensive planning effort that will identity the

15 measures and policies needed to achieve the reductions

16 necessary to reach the 2020 target. Staff will be

17 publishing a draft scoping plan in June of next year, and

18 the Board consideration on that item will occur in

19 November. The scoping plan will address the AB 32 program

20 design, include the impacts of all early action measures,

21 define the role of every strategy that isn't an early

22 action measure, determine the mix of additional

23 performance-based greenhouse gas regulations and

24 market-based measures, and reflect the emissions

25 reductions other agencies can be expected to provide.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234545

1 --o0o--

2 AIR RESOURCES ENGINEER ROBERT: 2009 is a rule

3 making year for whatever you adopt in the scoping plan.

4 We'll get started immediately in turning those strategies

5 into enforceable measures.

6 If a market-based program is included, we will

7 also need to create a regulatory structure to ensure that

8 all of the AB 32 criteria for a market-based approach are

9 met.

10 --o0o--

11 AIR RESOURCES ENGINEER ROBERT: In 2010, early

12 action measures must kick-in as a legally required. 2010

13 will also be a rulemaking year as we keep acting to

14 implement the scoping plan.

15 --o0o--

16 AIR RESOURCES ENGINEER ROBERT: By 2011, the law

17 envisions that we will have completed most of our major

18 rulemaking to achieve the 2020 emissions reduction target.

19 However, ARB is not prohibited from adopting additional

20 rules beyond that date.

21 --o0o--

22 AIR RESOURCES ENGINEER ROBERT: By 2012, we're

23 fully launched and begin the count-down process towards

24 achieving almost 30 percent reductions by 2020. Although

25 the law does not specify any review after this point,

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234546

1 we're thinking about an annual report and triennial

2 reviews of the overall plan implementation to make sure we

3 and other agencies are on track.

4 --o0o--

5 AIR RESOURCES ENGINEER ROBERT: The countdown

6 continues through 2020 and we start thinking about what

7 comes next, in order to meet the Governor's ambitious

8 target of an 80 percent greenhouse gas reduction by 2050

9 -- which is also where the international scientific

10 community is telling us we need to be.

11 --o0o--

12 AIR RESOURCES ENGINEER ROBERT: Staff established

13 a transparent process for identifying and selecting early

14 action measures, with an ample opportunity for public

15 discussion and input. All input, including oral comments

16 made at public meeting, electronic mail, and formal

17 written comments, were considered. The stakeholder input

18 received was very valuable and many of the suggestions

19 were added to our proposed early action plan. In many

20 instances, ARB received suggestions for actions outside of

21 our purview, which we turned over to the Climate Action

22 Team for consideration. Many of those suggestions are

23 contained in the CAT's early actions report which will be

24 workshopped next Monday in Sacramento.

25 Although we got more than 100 suggestions, only a

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234547

1 few met the stringent legal criteria of a discrete early

2 action as set forth in AB 32. But that doesn't mean they

3 weren't good ideas or that we don't need them eventually

4 to meet the 2020 goal. For that reason, we decided to

5 pursue early action measures under a three-tiered a

6 approach.

7 Group One is the list of discrete early actions

8 that staff is confident we can complete and turn into

9 regulatory form before the January 2010 deadline for

10 enforceability.

11 Group Two are regulations that will take a little

12 more time to complete, but which are appropriate to launch

13 now. Group Two also contains non-regulatory measures,

14 such as emission calculation protocols, that we asked to

15 finish quickly as, quote/unquote, "early action measures."

16 Group Three are the diesel and ozone controls

17 that ARB is already committed to and is pursuing on an

18 expedited rulemaking schedule. These measures have some

19 climate co-benefits. Many stakeholders were concerned

20 that these rulemaking efforts would be suspended or

21 delayed by our new climate responsibilities, which is

22 absolutely not the case. For that reason, we decided to

23 highlight the diesel and ozone rules that could have

24 important climate co-benefits as part of our overall early

25 action plan.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234548

1 The next step several slides will take us through

2 the Group One, Group Two, and Group Three measures in more

3 detail.

4 --o0o--

5 AIR RESOURCES ENGINEER ROBERT: Staff is

6 proposing three strategies in Group One that can be

7 adopted in time to meet statutory criteria of discrete

8 early action greenhouse gas reduction measures in the

9 Health and Safety Code. These include the Governor's Low

10 Carbon Fuel Standard, mitigation of refrigerant losses

11 from motor vehicle air conditioning servicing by the

12 non-professional do-it-yourselfer, and increased methane

13 capture from existing landfill. We estimate that these

14 measures will yield on the order of 13 to 26 megatons of

15 CO2 equivalent greenhouse gas emission reductions by 2020.

16 If you approve this list today, each of these

17 measures will be pursued as regulatory proposals that

18 would come before you in 2009. Also, staff will conduct

19 in-depth evaluations of the technological feasibility and

20 cost-effectiveness as required by law.

21 Let us expand on these measures briefly.

22 --o0o--

23 AIR RESOURCES ENGINEER ROBERT: The Low Carbon

24 Fuel Standard will require fuel providers to ensure that

25 the mix of fuels they sell meet, on average, a declining

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234549

1 standard for greenhouse gas emissions.

2 Transportation accounts for over 40 percent of

3 the greenhouse gas emissions in California. Therefore,

4 reductions of emissions from this source are vital.

5 This is the single biggest stand-alone measure

6 after the motor vehicle greenhouse gas standards the Board

7 has already adopted.

8 The Low Carbon Fuel Standard goal is to reduce

9 the carbon intensity of California's passenger vehicle

10 fuels by at least ten percent by 2020, cutting CO2

11 equivalent greenhouse gas emissions by 10 to 20 megatons.

12 That is equivalent to removing three million cars from the

13 road.

14 --o0o--

15 AIR RESOURCES ENGINEER ROBERT: The second

16 discrete early action would restrict the use of high

17 global warming potential refrigerant available for retail

18 purchase for recharging leaky automotive air conditioning

19 system. This strategy is taken directly from the set of

20 strategies developed originally by ARB for the Climate

21 Action Team report of March 2006. The proposed strategy

22 is similar to a ban of smaller refrigerants cans that has

23 been in existence in the state of Wisconsin for years.

24 Unfortunately many non-functioning auto air conditioning

25 systems have failed because they leak. Consumer efforts

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234550

1 to recharge these systems do not fix these leaks, but do

2 result in excess emissions.

3 Hydrofluorocarbons or HFCs are a class of

4 compounds that include ten individual substances. They

5 are used as substitutes for chlorofluorocarbons or CFCs,

6 which were identified as ozone depleting substances under

7 the Montreal Protocol. Major applications of HFCs are in

8 refrigeration, air conditioning, foams, solvents, aerosol

9 propellants, and fire protection which will be addressed

10 in other measures I will discuss. HFCs are very potent

11 greenhouse gases. Specifically, HFC-134a, the refrigerant

12 used nearly universally in motor vehicle air conditioning

13 systems, has a global warming potential of 1300 relative

14 to CO2, the most abundant greenhouse gas. The climate at

15 impact of refrigerants sold in small cans is not trivial.

16 A typical California passenger car traveling from

17 Sacramento to Los Angeles and back to Sacramento emits

18 less greenhouse gas emissions during that trip than the

19 equivalent contents of one single 12 ounce can of HFC-134a

20 as the one pictured here.

21 The threat on the climate posed by HFCs, the fact

22 that superior vehicle air conditioning technology is

23 emerging, and that feasible mitigation option exist are

24 the reasons for the complete ban of the HFC-134a in

25 vehicle air conditioners recently instituted in Europe

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234551

1 starting in 2011. ARB staff are following those

2 developments very closely to inform our own mitigation

3 strategy development.

4 This discrete early action is not a stand-alone

5 mitigation effort. It is one of the five HFC reduction

6 measures identified originally in the Climate Action Team

7 Plan. All strategies will be pursued. In addition,

8 realizing that HFC-134a used in cans for vehicle air

9 conditioners is not the only burden on the environment.

10 The impacts from other consumer applications and products

11 such as silly string or dusters are also under evaluation

12 by ARB staff as part of the Group Two strategies.

13 --o0o--

14 AIR RESOURCES ENGINEER ROBERT: Two groups have

15 proposed alternative approaches to staff's proposed ban on

16 do-it-yourself repairs. The first alternative proposal

17 came from the Aftermarket Refrigerant Products Institute,

18 which opposes staff's proposal and suggests that we pursue

19 self-sealing valves and a new deposit and return program

20 instead.

21 The Environmental Justice Committee is concerned

22 about taking away low-cost self repair options for lower

23 income citizens. They propose that leak testing be added

24 to the Smog Check program instead, where low income people

25 can take advantage of subsidized repairs. We think that

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234552

1 approach has merit and are looking at smog check

2 improvements within our Group Two strategy. However, this

3 approach would not qualify for an early action status

4 because state legislation and changes to the Bureau of

5 Automotive Repair's program would be required.

6 Staff is examining this alternative and is

7 continuing discussions with the industry, the U.S. EPA,

8 and other stakeholders. However, we acknowledge the

9 proactive approach of the industry for proposing what

10 appears to be a sensible approach that preserves much of

11 the benefit of the original measure proposed by staff.

12 --o0o--

13 AIR RESOURCES ENGINEER ROBERT: The third

14 discrete early action would set statewide standards for

15 the installation and performance of active gas

16 collection/controls systems at municipal solid waste

17 landfills.

18 Biological decomposition of organic waste in

19 landfills leads to the production of gases, consisting

20 mainly of carbon dioxide, methane, and trace amounts of

21 non-methane organic compounds. Methane is a potent

22 greenhouse gas having approximately 21 times the global

23 warming potential of carbon dioxide. Non-methane organic

24 compounds are precursors to ozone formation, can be toxic,

25 and some are odorous. In some instances, the gas may

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234553

1 migrate laterally underground and accumulate in nearby

2 structures on or near the landfill, posing as a potential

3 fire or explosive hazard. If uncontrolled or inadequately

4 controlled, landfill gas eventually migrates to the

5 surface where it could an order or problem or adversely

6 impact air quality.

7 Landfills are regulated by local air district

8 rules who impose Federal New Source Performance Standards

9 and Emission Guidelines and the National Emission

10 Standards for Hazardous Air Pollutants. Federal

11 regulations require emission controls for larger

12 landfills. However, there are no consistent statewide

13 standards for smaller and other uncontrolled landfills.

14 Approximately 40 landfills are identified by the

15 Waste Board as not having emissions controls. The

16 requirement for installing emission control systems at

17 uncontrolled landfills, and the improvement of collection

18 efficiencies at controlled landfills, is being considered

19 for a discrete early action resulting in total reductions

20 on the order of two to four megatons by 2020. In

21 developing the control measures, ARB will work closely

22 with the Waste Board staff who is developing a guidance

23 document for all landfill operators and regulators that

24 will recommend technologies and best management practices

25 for improving landfill design, construction, operation,

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234554

1 and closure for the purpose of reducing greenhouse gas

2 emissions.

3 --o0o--

4 AIR RESOURCES ENGINEER ROBERT: Staff is

5 proposing to initiate work on 23 additional greenhouse gas

6 emission reduction measures, with Board hearings and

7 rulemakings to occur as soon as possible where applicable

8 as illustrated in the next few slides.

9 These measures were drawn from various sources

10 including the March 2006 Climate Action Team Report and

11 stakeholder input. This group also includes strategies

12 ARB staff has recently identified such -- as cooler

13 automobile paints, standards for medium duty vehicles,

14 tire inflation requirements -- that could be developed

15 relatively quickly and produce significant greenhouse gas

16 reductions.

17 Group Two measures are expected to yield on the

18 order of 20 million metric tons of CO2 equivalent of

19 reductions by 2020, with reductions for several measures

20 still to be quantified.

21 As we mentioned previously, Group Two early

22 actions are commitments of equal merit as those in Group

23 One and that will yield real greenhouse gas reductions.

24 They are not included in Group One for one of two reasons.

25 Some are not regulations but will be implemented as

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234555

1 guidance or protocols. Others will likely be regulations,

2 but staff does not believe we can deliver them as

3 enforceable regulations by January 1st, 2010.

4 --o0o--

5 AIR RESOURCES ENGINEER ROBERT: This slide

6 illustrates our early action work plan for 2008. We are

7 spending much effort on protocol development so that local

8 governments, small businesses, and the agricultural

9 community can take effective early steps that reduce

10 greenhouse gases and that have more confidence about what

11 those strategies will provide in the way of total

12 reductions. We're also working on a major truck rule to

13 reduce diesel particulate and ozone precursors, and will

14 consider requirements related to greenhouse gases at the

15 same time. We're referring to these measures as "smart

16 way" improvements for convenience, since that's the name

17 U.S. EPA has already given to truck efficiency measures.

18 Next year, we will also expect to bring our port

19 electrification strategy to the Board, which we expect to

20 be a combination of regulatory and incentive measures.

21 Just to remind the Board of what I've already

22 discussed, during 2008, newly hired or redirected staff

23 must also complete all of the Group One early action

24 measures while concurrently completing the comprehensive

25 scoping plan indicating how the 2020 target will be

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234556

1 achieved.

2 --o0o--

3 AIR RESOURCES ENGINEER ROBERT: In 2009, staff is

4 proposing to bring you four separate regulations for the

5 categories identified on the slide. We're still not

6 entirely sure what form the tire inflation program will

7 take. There are lots of public education programs out

8 there, but we would look to take them up a notch and

9 consider regulatory alternative. However, we're having a

10 significant difficulty figuring out how to enforce a more

11 mandatory approach.

12 In 2009, staff will also start working on the

13 implementation of additional regulations and market

14 measures approved by the Board in the preceding year.

15 --o0o--

16 AIR RESOURCES ENGINEER ROBERT: In 2010, we have

17 more regulations planned, plus continued work on

18 implementing the scoping plan.

19 --o0o--

20 AIR RESOURCES ENGINEER ROBERT: In 2011, we're

21 bringing you two specialty regulations, that we're just

22 starting to conduct the research on today. Specifically,

23 controls to reduce HFCs during foam production,

24 installation, lifetime, and end-of-life. Also,

25 alternative chemicals for fire suppression which have

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234557

1 lower global warming potentials.

2 2011 is also when the ARB is required to complete

3 all of their major rulemaking necessary to implement the

4 comprehensive scoping plan you will adopt at the end of

5 next year.

6 --o0o--

7 AIR RESOURCES ENGINEER ROBERT: 2012 is our

8 target date for updating the greenhouse gas standards for

9 motor vehicles to achieve an additional four million

10 metric tons of greenhouse gas reductions by 2020. As you

11 may recall, the existing regulation takes effect in the

12 2009 model year and has a step function in 2012. The new

13 regulation would kick into for 12016 and beyond, giving

14 manufacturers sufficient lead time to make whatever

15 additional changes are required.

16 In 2012, all other major greenhouse gas reduction

17 rules will be operational and staff will be in a

18 preliminary enforcement mode.

19 --o0o--

20 AIR RESOURCES ENGINEER ROBERT: There are five

21 measures in Group Two for which the hearing date is still

22 to be determined.

23 For stationary agricultural engines, the issue is

24 what more we can do to promote electrification through the

25 Public Utilities Commission and other utility tee

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234558

1 rate structures.

2 Sulfur hexafluoride use is being reduced, so

3 we're not sure whether an ARB regulation will be needed.

4 TRU stands for transportation refrigeration

5 units, also known as "refers," which the Board has already

6 regulated. Electrification requirements could be added to

7 the strengthen that regulation. We're evaluating how

8 costly this might be and when that might be most

9 appropriate to do. We don't want to disrupt the

10 compliance efforts industry is already taking to meet our

11 standards.

12 Truck stop electrification is an incentive-based

13 program so we're evaluating how much we need and when to

14 pursue that funding.

15 Finally, smog check improvement are also a

16 possibility. However, we have very little control over

17 when they are actually implemented by the Bureau of

18 Automotive Repair. Close coordination with the BAR will

19 be necessary.

20 --o0o--

21 AIR RESOURCES ENGINEER ROBERT: Our Group Three

22 strategies include all of the diesel particulate and ozone

23 precursor rules this Board has already committed to. You

24 will be evaluating these tomorrow when you take up ARB's

25 proposed statewide strategy for inclusion in the federally

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234559

1 required State Implementation Plan. There is

2 extraordinary concern that these measures will somehow be

3 delayed or derailed by ARB's new climate change

4 responsibilities. We included Group Three to underscore

5 that that is absolutely not the case and to reflect the

6 fact that reducing diesel PM will help meet our climate

7 protection goals. Staff remains fully committed to

8 accomplishing these measures.

9 Although not on this slide, the implementation of

10 the one billion dollar bond to reduce Goods Movement

11 related emission is another key part of ARB's diesel clean

12 up strategy and will be discussed in greater detail at

13 tomorrow's meeting.

14 --o0o--

15 AIR RESOURCES ENGINEER ROBERT: The 37 early

16 action measures proposed by ARB staff are categorized into

17 three separate groups. Together we expect these measures

18 will reduce greenhouse gas emissions by at least 33

19 megatons of CO2 equivalents annually by 2020.

20 It is important to recognize that many other

21 significant greenhouse gas emissions reductions are

22 already in the pipeline. Existing ARB regulations,

23 namely, the AB 1493 vehicle climate change standards, will

24 contribute an additional 30 megatons of reductions. The

25 diesel risk reduction measure co-benefits remain to be

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234560

1 determined and are not included in this 30 million tons.

2 Regarding the latter, the greatest greenhouse gas

3 reductions are expected to come from ARB's anti-idling

4 controls and from port electrification.

5 Group One includes three measures that meet the

6 narrow stringent criteria for discrete early actions.

7 These will yield reductions on the order of to 10 to 20

8 megatons or the approximately 10 percent of the overall

9 2020 reduction target. Group Two are 23 additional

10 greenhouse gas reduction strategies that will result in

11 reductions on the order of 20 megatons of CO2 equivalents

12 or approximately 12 percent of what may be needed by 2020.

13 Group Three are existing measures from our diesel control

14 and fuels programs. However, we still need to determine

15 to climate co-benefits from reducing diesel particulate

16 matter, ozone precursors, and other criteria pollutants.

17 Together, ARB's existing regulations and our new

18 proposed early actions add up to our lower estimate of 63

19 megatons of CO2 equivalent reductions.

20 All identified early actions are commitments that

21 ARB will pursue in the next few years.

22 The early actions report also acknowledges the

23 importance of voluntary action and education efforts in

24 the overall climate protection program. Staff is planning

25 to expand our analysis and efforts in these areas in the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234561

1 near future. The remaining reductions needed to close the

2 gap for meeting the 2020 target will come from the other

3 efforts.

4 Now I will turn to outstanding issues related to

5 staff's proposal.

6 --o0o--

7 AIR RESOURCES ENGINEER ROBERT: Several

8 stakeholders felt that staff should have identified more

9 than three discrete early action strategies. As I have

10 already described, AB 32 requires that each discrete early

11 action be regulatory in nature, be enforceable by

12 January 1, 2010, and be both technologically feasible and

13 cost-effective. There's no getting around the practical

14 fact that it takes time and tremendous staff effort to

15 work through regulatory issues and get the language just

16 right. That practical consideration is what drove us to

17 constrain the list of items in Group One to just three

18 measures. However, I want to stress that staff is

19 avoiding hard work. We put the biggest, hardest, most

20 time-consuming rulemaking in Group One, the Low Carbon

21 Fuel Standard. So even though our list is short, it is

22 extremely ambitious.

23 --o0o--

24 AIR RESOURCES ENGINEER ROBERT: Several

25 stakeholders asked about the definition of

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234562

1 cost-effectiveness and are concerned that we had not

2 offered a legal definition as part of this action.

3 Although everyone agrees that cost-effectiveness means

4 dollars per ton, certain stakeholders feel there is an

5 upper limit that should be defined at this time.

6 As part of the rule development process, staff

7 will work with stakeholders to establish a robust

8 definition. As we developed a scoping plan, we will also

9 develop a method of judging relative cost-effectiveness.

10 However, at this early stage in the process, more time is

11 needed to complete a full cost-benefit analysis for each

12 proposed measure. Thus, we must operate on a presumption

13 that the proposed early actions will meet the

14 technologically feasible and cost-effectiveness criteria.

15 In the event that it's found later that a measure cannot

16 be designed in a way that meets all legal requirements, it

17 would be removed from the list.

18 --o0o--

19 AIR RESOURCES ENGINEER ROBERT: Some stakeholders

20 felt that specific early action measures are not

21 cost-effective and should be removed from consideration

22 for that reason. In particular, the proposed ban on HFC

23 do-it-yourselfer cans and the Low Carbon Fuel Standard

24 were mentioned in this vein.

25 Cost-effectiveness is a legal requirement for any

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234563

1 regulation adopted by this Board. However, it is not a

2 prerequisite to make such a determination for simply

3 listing an early action measure. If, at the time of

4 rulemaking, staff concludes that an early action measure

5 cannot be developed in a cost-effective form for a

6 particular source category strategy, we will recommend

7 instead that the proposed early action measure be deleted

8 from the list.

9 --o0o--

10 AIR RESOURCES ENGINEER ROBERT: The AB 32

11 Environmental Justice Advisory Committee has several

12 concerns about the proposed early action measures,

13 including what has been proposed by staff and what has

14 been omitted from the list. The EJ Committee's

15 presentation will follow staff's presentation, so I will

16 not speak for them now. However, I will have highlight

17 two specific concerns that the EJ Committee raised about

18 the rules we are proposing for your consideration.

19 First, that the proposed ban on do-it-yourself

20 HFC cans for vehicle air conditioning systems is

21 economically regressive and will hurt poor people the

22 most. Staff is not convinced that is the case, but is

23 taking the Committee's concerns seriously and trying to

24 clarify the socio-economic status of person affected by

25 the proposed rule.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234564

1 The second major concern has to do with the food

2 versus fuel debate that has sprung up across the nation

3 and world as more areas seek to use biofuels for

4 transportation. There are legitimate concerns regarding

5 potential effect of California low carbon fuel standard.

6 This issue will be evaluated and discussed in detail

7 during the rulemaking for low carbon fuels. However,

8 staff does not believe it warrants deletion as an early

9 action measure.

10 --o0o--

11 AIR RESOURCES ENGINEER ROBERT: In conclusion,

12 based on the staff's consideration of requirements,

13 initial investigation of feasibility, and consideration of

14 practical opportunities and constraints in administrative

15 capacity, ARB staff recommends that the Board approve the

16 staff proposal. This includes commitments to develop the

17 list of discrete early action measures in Group One and

18 the additional measures recommended by staff in Group Two

19 and Three. We further recommend that you direct staff to

20 develop regulations to implement these measures in

21 accordance with the timelines identified in this

22 presentation.

23 --o0o--

24 AIR RESOURCES ENGINEER ROBERT: The ARB is still

25 near the beginning of the early action process with

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234565

1 considerable work ahead to develop full proposals. Upon

2 the ARB adoption of a Board resolution, staff will begin

3 the regulatory development of the three discrete early

4 actions as well as continue to develop and implement the

5 additional Group Two and Three greenhouse gas reduction

6 measures.

7 To keep the Board fully apprised of these

8 efforts, staff proposes to provide regular updates every

9 six months.

10 The early actions proposed today do not exhaust

11 all possible ways of stimulating efforts by companies,

12 municipalities, and individuals to reduce greenhouse gas

13 emissions prior to implementation of the overall scoping

14 plan for AB 32. Staff stands prepared to broaden or

15 modify the scope if supported by the full analysis of each

16 measure.

17 That concludes the staff's presentation. Thank

18 you for your attention. And we would be happy to answer

19 any questions that you may have.

20 CHAIRPERSON SAWYER: Thank you, Dr. Robert.

21 I think what we'll do is to take the statement

22 from the Environmental Justice Committee first, and then

23 come back to both the staff and the Environmental Justice

24 Committee for the question period.

25 Before Ms. Johnson-Meszaros begins her

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234566

1 presentation, I want the thank the considerable -- the

2 Committee for its considerable effort that is put into

3 developing these recommendations on this matter. Thank

4 you for being here today. And for contributing to our

5 AB 32 implementation process.

6 Ms. Johnson-Meszaros.

7 MS. JOHNSON-MESZAROS: Good morning, Dr. Sawyer,

8 members of the Board.

9 I have a presentation, a PowerPoint version of

10 this presentation, which I'm hoping can be projected.

11 That would be it.

12 --o0o--

13 MS. JOHNSON-MESZAROS: I'm Angela

14 Johnson-Meszaros, I'm the co-chair of the Environmental

15 Justice Advisory Committee on the Implementation of Global

16 Warming Solutions Act of AB 32.

17 --o0o--

18 MS. JOHNSON-MESZAROS: I just wanted to quickly

19 outline the responsibility of this Committee which was

20 created in the statute. Which is basically to advise the

21 ARB in developing the scoping plan and any other pertinent

22 matter in implementing this division and we believe that

23 this vote that you are taking today is certainly a

24 pertinent matter.

25 --o0o--

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234567

1 MS. JOHNSON-MESZAROS: At our first Committee

2 meeting, we adopted a Mission Statement and just to

3 highlight, through our advice, we are seeking to provide

4 helpful and workable recommendations on how best to ensure

5 and encourage public engagement in the implementation of

6 the Act and how best to reduce greenhouse gas emissions,

7 while maximizing the overall societal benefits, including

8 reductions in other air pollutants, diversification of

9 energy sources, and other benefits to the economy, the

10 environment, and public health.

11 --o0o--

12 MS. JOHNSON-MESZAROS: I also wanted to make sure

13 that I acknowledged my co-Committee members who have all

14 been working quite diligently as we have been undertaking

15 our responsibilities under the Act. And to hopefully

16 impress upon the Board the vast resources that are

17 available on this Committee. We are 21 people from around

18 the state representing 18 different organizations with a

19 wide range of experience and expertise, not just in the

20 environmental justice issues, generally, but also specific

21 areas of expertise and extensive education and background

22 which allows us to bring, we think, a lot to this

23 conversation about how California is going to implement

24 AB 32.

25 --o0o--

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234568

1 MS. JOHNSON-MESZAROS: Also, I just want to take

2 a second to frame, and actually I couldn't frame better

3 than the presentation you heard this morning about the

4 impacts of global warming, but in particular, I wanted to

5 focuses on these words that were from the staff at their

6 January 2nd meeting about early action measures:

7 California in its longstanding tradition of environmental

8 stewardship has positioned itself at the forefront of

9 climate protection efforts.

10 And we agree that that's completely the case and

11 we know that there are people, not just around the state

12 and not just around the country, but around the world who

13 are looking to see what this Board decides today as an

14 indicator of our commitment as we move forward to address

15 climate change issues.

16 --o0o--

17 MS. JOHNSON-MESZAROS: So with that, I wanted to

18 outline the Committee's work on this issue.

19 We reviewed the staff's early action report which

20 contained a hundred measures. We reviewed all the letters

21 that we could get from staff regarding -- that were

22 submitted to the staff suggesting early action measures.

23 We engaged in approximately 12 hours of public dialogue at

24 three separate Committee meetings. And we developed

25 reasonable statutorily-based criteria and applied them to

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234569

1 each of the suggested measures that are outlined in the

2 staff's report.

3 --o0o--

4 MS. JOHNSON-MESZAROS: Our criteria that we

5 developed and applied is, most importantly, is the measure

6 technologically feasible? Secondly, does the measure

7 cause increases in criteria or air toxic emissions, often

8 called backsliding. Third, are there co-pollutant

9 reduction benefits from the measure, which of course is

10 something that's critically important, not just in meeting

11 the requirements of AB 32, but also in protecting and

12 enhancing health that are impacted by pollution? And

13 fourth, does the measure have disproportionate positive or

14 negative impacts on communities already facing

15 unacceptably high environmental burdens?

16 --o0o--

17 MS. JOHNSON-MESZAROS: After applying -- after

18 developing and applying those criteria, the Committee

19 recommended only about 30 percent of the overall list for

20 inclusion in the early action list.

21 We thought that it is better to start with a more

22 robust list, as was just outlined in staff's presentation,

23 which allows for a refinement of particular rules through

24 the process, for things like the application of the

25 cost-effectiveness standard and unforeseen rule

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234570

1 development issues. Because overall we think that the

2 worst possible outcome would be unnecessary delay in

3 achieving reductions.

4 --o0o--

5 MS. JOHNSON-MESZAROS: We took note of the fact

6 that in the staff's report, they said: Staff anticipates

7 bringing these measures to the Board with, the Group Two

8 measures, to the Board for adoption within the next three

9 years. Some may begin implementation of the rules prior

10 to January 2010. But many may not. The bulk of our

11 recommendations are from the Group Two strategies, and we

12 wondered why not add them to the early action list.

13 --o0o--

14 MS. JOHNSON-MESZAROS: I also should note that

15 the Committee recommended removal from the early action

16 list for two particular items as staff has flagged for you

17 already.

18 --o0o--

19 MS. JOHNSON-MESZAROS: The Low Carbon Fuel

20 Standard, I think of this as being the putting all of our

21 eggs in one basket standard.

22 --o0o--

23 MS. JOHNSON-MESZAROS: The Committee support the

24 reductions of carbon content in transportation fuels and

25 we should be clear and upfront about that. We simply

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234571

1 don't recommend it as an early action measure.

2 --o0o--

3 MS. JOHNSON-MESZAROS: The early action measure

4 that's proposed is a carbon-intensity standard.

5 --o0o--

6 MS. JOHNSON-MESZAROS: It's our understanding

7 from the report that was done by Dr. Sperling, one of your

8 co-members, and Dr. Farrel at U.C. Berkeley, that with an

9 intensity standard, what we can anticipate happening is a

10 ten percent reduction in carbon intensity will result in

11 an increase of 13 percent in absolute emissions from

12 transportation fuel usage. Using an intensity standard,

13 one would need to have something in the order of a 31

14 percent intensity reduction as compared to the ten percent

15 intensity reduction that's being recommended now. Part of

16 that is because of the technological feasibility of having

17 such an extensive reduction in the -- in carbon from

18 carbon fuels.

19 --o0o--

20 MS. JOHNSON-MESZAROS: So what does that mean?

21 That means that the ten to 20 tons that is outlined in the

22 report doesn't result in reductions below the 1990 levels,

23 and, in fact, in 2010, emissions from fuels will be higher

24 than they are now. We support technologically enforcing

25 rules. However, this early action mix is too risky. We

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234572

1 support a wider range of measures that gets

2 health-enhancing reductions in communities right now.

3 --o0o--

4 MS. JOHNSON-MESZAROS: What are some of the

5 possible risks of the Low Carbon Fuel Standard? The UN

6 has found in its first major report looking at this issue,

7 that while it does hold promise for quite a bit of

8 reductions, changes in the carbon content of soil and

9 carbon stocks for forests might undercut some or all of

10 the benefits of the greenhouse gas reductions.

11 The report that was completed by U.C. Berkeley

12 and U.C. Davis acknowledged that it hadn't looked yet at

13 the environmental impacts of a Low Carbon Fuel Standard.

14 --o0o--

15 MS. JOHNSON-MESZAROS: One of the other possible

16 risks of a low carbon fuel standard, the negative impacts

17 on food prices. This is an article that was published in

18 the MIT's Technology Review which talks about how the food

19 prices are rising, both in the United States and around

20 the world, and right now, they're saying there's over a

21 hundred different ethanol plants under construction. We

22 believe that ethanol in the short term is going to be the

23 path for low carbon fuels reductions, and we believe it's

24 problematic.

25 --o0o--

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234573

1 MS. JOHNSON-MESZAROS: Another possible risk is

2 the impacts on social order. The Washington Post reported

3 that there had been essentially food riots in Mexico

4 because of the increased costs of corn resulting in

5 increased costs of tortilla, which is, of course, a staple

6 in the diet there.

7 --o0o--

8 MS. JOHNSON-MESZAROS: Another possible issue is

9 impacts around public health, and many of you are familiar

10 with the Jacobsen study from U.C. Stanford, indicating

11 that a high blend of ethanol poses equal or greater risk

12 to public health than gasoline, which already causes

13 significant health damage.

14 --o0o--

15 MS. JOHNSON-MESZAROS: So as a summary, we

16 believe that Low Carbon Fuel Standards is an important

17 area for carbon reductions. But we also believe early

18 action measures must be technologically feasible and not

19 cause backsliding, and currently available fuels do not

20 seem to meet this test. And early action measures must

21 avoid disproportionate negative impacts on low income

22 communities and communities of color. We believe that

23 disruptions in food, an increase in food prices,

24 backsliding in criteria pollutants and in toxics will have

25 such impacts and the currently fuel mix do not meet the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234574

1 standard.

2 --o0o--

3 MS. JOHNSON-MESZAROS: The second measure is the

4 reduction of HFCs from the non-professional servicing of

5 cars.

6 --o0o--

7 MS. JOHNSON-MESZAROS: The Committee supports

8 reduction in HFCs. We recommend -- we understand that

9 it's an important greenhouse gas and it ought to be

10 addressed.

11 --o0o--

12 MS. JOHNSON-MESZAROS: We simply don't believe

13 that the regulation proposed by staff meets the

14 requirements in AB 32.

15 --o0o--

16 MS. JOHNSON-MESZAROS: It's the only measure, as

17 staff indicated before, in a suite of possible measures

18 that had already been identified targeting HFC reductions.

19 What that means is the standard that's being proposed for

20 early action takes on a very regressive component.

21 --o0o--

22 MS. JOHNSON-MESZAROS: And that we believe, and I

23 understand that staff defers with this, low income people

24 of color and -- are disproportionally likely to rely upon

25 home-based auto repair and stop-gap repair options, such

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234575

1 as using these small cans of HFC-134 to fill air

2 conditioning.

3 --o0o--

4 MS. JOHNSON-MESZAROS: So instead of the small

5 can ban, the Committee is recommending that ARB undertake

6 a broader review of all possible HFC reductions, including

7 the evacuation of refrigerants from decommissioned and

8 stored cargo containers, and evacuations of HFCs from cars

9 prior to scrappage. And we just note that there are 33

10 million cars registered in California. At some point, I

11 suspect some large number of those cars will end up being

12 decommissioned and scrapped, with an average of about two

13 pounds of HFCs in a fully charged air conditioner, and we

14 believe there are substantial reductions that are possible

15 from such a measure.

16 --o0o--

17 MS. JOHNSON-MESZAROS: In summary, we recommend

18 that the Committee vote to do four things.

19 First, reduce HFCs without causing negative

20 disproportionate impacts on low income communities and

21 communities of color.

22 Continue the work on developing a Low Carbon Fuel

23 Standard for implementation after the early action period.

24 Fourth, replace the low carbon fuel measure and

25 the resources needed for its accelerated implementation

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234576

1 with measures having the highest co-benefit reductions.

2 We think this would include ports issues, refinery issues,

3 cement measures, and actually I left off, reductions in

4 the energy sector.

5 And at the very minimum, add to the list those

6 items which staff indicated could be done by 2010. So

7 that those reductions aren't lost.

8 --o0o--

9 MS. JOHNSON-MESZAROS: So my mother taught me a

10 lot of very useful things, and I think this is a time to

11 remind people that doing anything is not the same thing as

12 doing something. And we hope that you will be able to

13 adopt a broader range of early action measures.

14 Thank you.

15 CHAIRPERSON SAWYER: Thank you,

16 Ms. Johnson-Meszaros --

17 (Applause.)

18 CHAIRPERSON SAWYER: -- for a presentation which

19 I personally found to be particularly clear, succinct, and

20 forceful.

21 MS. JOHNSON-MESZAROS: Should I stay?

22 CHAIRPERSON SAWYER: Yes, please stay because

23 we're going to take questions of the staff and of you at

24 the same time from the Board members.

25 All right. I would like to ask the first round

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234577

1 of questions because I know that we are -- have been

2 criticized for not having more items on the list. And I

3 want to understand a little bit more about resource

4 limitations on dealing with putting places in measure.

5 First, the available time and then the available

6 staff. This is roughly the first of July, and these

7 measures are to be in place by 2010. I count that as

8 being 30 months. But you speak of 18 months as the time

9 in which it has to be done. Would you explain where the

10 18 months comes from and what happens in that other 12

11 months, and if anything can be done to accelerate that?

12 EXECUTIVE OFFICER WITHERSPOON: Yes, Dr. Sawyer.

13 We count backward from the day that the regulations are

14 approved by the Office of Administrative Law and become

15 legally effective. So after this Board hears regulations,

16 we go through an intensive processing step with the Office

17 of Administrative Law, where we complete the CEQA record

18 for the entire rulemaking. We prepare a written document

19 responding to every comment raised and the answer thereto.

20 There are interim steps with the Office of Administrative

21 Law, at times, if they think that our answers are not

22 complete or compelling and ask us is there more data that

23 can be brought to bear.

24 At sometimes we also have an additional process

25 with stakeholders, which you know as the 15-day change

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234578

1 process. It doesn't actually take 15 days. Months pass

2 after rulemaking as we write new regulatory language to

3 accomplish the 15-day change. The 15 days is how long the

4 stakeholders get to read it. And, then, we go and

5 complete the rulemaking, once again, processing through

6 OAL.

7 So through years of experience, we've learned to

8 give ourselves roughly 12 months after rulemaking to

9 finish the final posting of the rule. When there are very

10 few issues, when we are well prepared in advance, we can

11 shrink the OAL review process to as few as six months,

12 perhaps eight months. But we're in dangerous territory

13 then to meet the legal deadline that they be fully

14 approved by OAL, posted in the Code of California

15 Regulations and legally enforceable.

16 So our aim is to bring you all discrete early

17 action measures by the end of next year so we have that

18 year for processing. We could go as late as February of

19 '09, and have ten months or so. But we wouldn't want to

20 push it much father than that for Group One measures.

21 CHAIRPERSON SAWYER: And the other question has

22 to do with available staff. I know that we've been

23 promised considerable number of new staff and we certainly

24 appreciate that. But what is our current authority to

25 hire, and how many new people have we hired to work on

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234579

1 AB 32 issues at this time?

2 EXECUTIVE OFFICER WITHERSPOON: We don't have

3 really legal authority to hire. What we have is the

4 ability to put people in what's our blanket, unallocated

5 positions, unallocated costs, with the expectation that

6 come July, there will be a state budget. We've sought 120

7 new positions, granted to us quarterly, so that we can do

8 hires of 30, 30, 30; is that right? It is. Because, once

9 we're given a position, if it's not filled in six months,

10 it's taken away from us. And we can't higher 120 people

11 at once.

12 So we're staggering the hires over the next year,

13 and we have hired approximately 20 or so people so far.

14 We've had mostly internal reassignment as our experienced

15 managers have moved into climate work and we've hired

16 behind them in our conventional pollution control.

17 The one difficulty we have is, even with new

18 hires, we won't have experienced regulatory staff on day

19 one, so we have to use our experienced managers to develop

20 these regulations and train up the new people to take on

21 toxics control, to take on diesel control, to take on smog

22 check. And we are trying to attract managers, but our pay

23 scales don't match as well any longer with other state

24 agencies, so we have problems with laterals, where other

25 agency staff have to demote to come work for us and not

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234580

1 everyone's willing to do that.

2 DEPUTY EXECUTIVE OFFICER SCHEIBLE: I also want

3 to add that, over the last couple of years, we've really

4 loaded up the rulemaking process. We're doing the most

5 difficult diesel control measures as the Board last month

6 and will see next month with a construction rule and the

7 other rules that are coming forth.

8 Last year, we did the ports goods movement plan

9 and we put numerous rulemakings in there that are

10 reflected in the proposed plan here.

11 So the availability to shift staff from one

12 rulemaking to another isn't there unless we're willing to

13 sacrifice the timeliness of those basic programs. And I

14 think we've clearly decided through all of those efforts

15 that public health and protecting communities demands that

16 we continue and do those as quick as possible.

17 So staff is working extremely hard and we are

18 stretched to our limits. And the AB 32 process will

19 stretch those limits further. Help is on the way, but

20 it's not going to arrive in time so that we can reload the

21 rulemaking process with, you know, complicated new

22 measures in large numbers.

23 CHAIRPERSON SAWYER: Thank you. I would also

24 notice that apparently the web cast has not been going

25 out. Does that continue to be the case?

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234581

1 SECRETARY ANDREONI: Yes.

2 CHAIRPERSON SAWYER: Are we getting an audio out

3 or nothing?

4 SECRETARY ANDREONI: It's starting to work right

5 now, Chairman.

6 CHAIRPERSON SAWYER: Okay. Well, then to the

7 people who have been waiting for the web cast, I apologize

8 that the first hour and 45 minutes was not operating

9 correctly. And I hope that it will remain on for the rest

10 of the next -- of this day and tomorrow.

11 Questions, comments from Board members.

12 Ms. D'Adamo.

13 BOARD MEMBER D'ADAMO: I'd like to compliment

14 staff on its recommendations. I think that we need to be

15 very committed. We need to move quickly. But we also, at

16 the same time, need to be measured in how we move forward,

17 and I really appreciate staff laying out the different

18 groups and the timelines.

19 And just sort of in follow-up to the previous

20 discussion about staff resources, I, looking at slide 19,

21 Group Two, Strategies for the Board Hearing and Board

22 Hearings in 2008, I guess, initially, when I saw these

23 different groupings, I understood that the groupings were

24 in order of some type of time frame, but it actually

25 appears that there's overlapping time frames within

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234582

1 groups. And, in fact, early action measures are going to

2 be adopted, the proposal is to adopt them in December, but

3 we would be moving forward on some of the Group Two items

4 prior to that. Could you explain how that fits in with

5 timeline with Group One?

6 EXECUTIVE OFFICER WITHERSPOON: You're correct

7 that they're overlapping. All of those July items are

8 non-regulatory. So they couldn't be in Group One even if

9 we wanted to put them there because there are not

10 regulations. But they are very strongly desired by the

11 affected stakeholders and so we have given them high

12 priority. We do have a running start on most of them

13 because the California Climate Action Registry has

14 innovated these protocols and adapted some of them to the

15 California situation. But we have to go through an

16 additional public process of workshops in bringing them to

17 your -- to you for final approve. And so we've scheduled

18 that for July. And if we can get them here any sooner, we

19 will. So that's why the July or earlier.

20 BOARD MEMBER D'ADAMO: So they're not regulatory,

21 I see protocol under most of them. But are these watered

22 down versions of what the Environmental Justice advocates

23 are pushing for or were they actually pushing for

24 protocols and other items that are non-regulatory in

25 nature?

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234583

1 EXECUTIVE OFFICER WITHERSPOON: I don't remember

2 protocols being on the Environmental Justice Committee

3 list. They do have methane digesters on their list, but

4 their concern is not the protocol for how much methane is

5 controlled by a digester. They're concerned about what

6 the concurrent criteria pollutant emissions might be. And

7 so they have asked us not to issue a methane digester

8 protocol until such time as we have guidance on what would

9 constitute fact for those facilities because the protocol

10 itself could encourage the deployment of the more

11 digesters and potentially more emissions, is the concerns.

12 So we have tasked the stationary source division with

13 doing that work.

14 CHAIRPERSON SAWYER: Ms. Johnson-Meszaros, do you

15 want to comment on that?

16 MS. JOHNSON-MESZAROS: We do support the protocol

17 development that's been outlined, but we agree that it

18 doesn't qualify as an early action because of the fact

19 that it's not regulatory. So we definitely agree with

20 that and we believe there's a large role for education and

21 other kinds of efforts like that.

22 On the methane digester, if I understand

23 correctly with what Ms. Witherspoon just said, I don't

24 believe that our Committee forwarded such concerns and I

25 don't believe that we asked that that not be on -- not be

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234584

1 developed. We do believe that through the rulemaking

2 process, there has to be concern -- there has to be

3 attention paid to possible backsliding. We believe that

4 that can be developed and addressed in the rulemaking

5 process.

6 BOARD MEMBER D'ADAMO: And just in follow-up, I

7 happen to know a bit about methane digesters and I do

8 think that we need to protocol, and it's just not ready

9 for full development in terms of a regulation. So just as

10 an example, I think that points to our need to really get

11 it right before we commit to adopting a regulation. So I

12 think that this is probably a good approach.

13 And, then, another question, on Group Three,

14 again these items, some of them actually go before early

15 action. And most of them, I suspect, are -- would be

16 included in the SIP and would be enforceable through other

17 mechanisms as well; correct?

18 EXECUTIVE OFFICER WITHERSPOON: That is correct.

19 BOARD MEMBER D'ADAMO: And, then, the last

20 question which is really more of a comment on the Low

21 Carbon Fuel Standard, just would like to encourage staff,

22 I support its inclusion as an early action item. But I do

23 agree with some of the comments that I've received in

24 separate discussions and the one Ms. Johnson raised

25 regarding sustainability and think that we definitely need

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234585

1 to incorporate that into our evaluation and I know

2 Professor Sperling is looking closely at that as well.

3 Thank you.

4 CHAIRPERSON SAWYER: Supervisor.

5 SUPERVISOR HILL: Thank you, Mr. Chairman.

6 Also kudos to the staff for an outstanding effort

7 and a tremendous amount of work over the last year in

8 putting together an outline in the different groups.

9 You know, however, looking at it, is somewhat of

10 a disappointment in the fact that we are not including

11 more items in the early action. And I know there's, the

12 staff is looking at that, and I guess it's some

13 clarification that I'm looking for.

14 In listening to the presentation, we talked about

15 the issues of, you know, the fact that we're hiring a

16 hundred employees and the staff restrictions, some of them

17 are not regulatory, and those issues were raised. But

18 what were the criteria used to limit? I mean was it just

19 the staff or in some of the regulations or the regulatory

20 items or are there other items or reasons that the items

21 were not included in Group One, rather than Group Two or

22 Three? Besides the staff resource limitations that we

23 had.

24 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Well, the

25 primary criteria were, one, we thought that the concept

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234586

1 could produce emission reductions, and do so in a pretty

2 substantial way.

3 Two, we understood it well enough to be, so that

4 we thought there was a clear route, at least a concept of

5 the regulation and how it might work. The details may

6 take forever, the Low Carbon Fuel Standard. The details

7 are going to be the devil in that process and will take

8 tremendous amounts of time.

9 Number three, was that it stood on its own. So

10 things that controlled carbon intensity of fuel or methane

11 or refrigerants were attractive because those aren't good

12 candidates, they're performance-based standards.

13 And four, it didn't conflict with work going on

14 in other sectors. So there are lots of ideas but what we

15 do with electricity and what we do with refineries and

16 what we do with oil production types of sources. And

17 we're going to evaluate those as we figure out the scoping

18 plan, and in that process, decide what's a

19 performance-basis measure versus what's a candidate for

20 our market system where we limit overall emissions.

21 And we didn't have good ideas and couldn't tell

22 you, for example, that for refineries, it's how big the

23 reducing flaring or controlling methane leaks. We know

24 they're not the major source. So those things seem to be

25 deferred.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234587

1 And after you got to just the first through

2 measures, the amount of resources and the time it took was

3 all we could obligate ourselves to. We weren't satisfied

4 with that, either. So we vastly expanded the concept of

5 saying we're doing early action under the law, then early

6 action plus. And I think when you look at many of the

7 recommendations we've got from the EJ Committees and from

8 many others, there's a great deal of overlap there. And

9 it's really what's the time commitment and the legal

10 vulnerability we're under? We're going to produce all of

11 these things as fast and well as we can. And some of them

12 that aren't expressed in this list will be done as part of

13 the scoping plan. And with other agencies.

14 SUPERVISOR HILL: And I noticed in the CAPCOA

15 letter that was sent on May 14th outlines a number of

16 issues, you know, prioritizing the SIP rulemaking, review

17 existing rules for those benefits that can be derived from

18 all feasible measures. And I thought the leverage of CEQA

19 mitigations is something that, you know, I don't know if

20 those can be included, but those are items that I think

21 can capture a lot of emission reductions, as well as the

22 voluntary reductions. You know, in San Mateo, or in the

23 Silicon Valley, they've done tremendous things working

24 with SYSCO and a lot of the companies that have reduced a

25 tremendous amount of CO2 emissions over the last five

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234588

1 years. And, you know, I have hope, and I don't know how

2 those types of recommendations can be included as we move

3 forward as early as possible, because what I'd hate to see

4 happen is, as we saw the wonderful presentation on global

5 warming and the real sad situation that we find ourselves

6 in, I'd hate to see us at 2030, saying we didn't have the

7 resources back in 2007 to put towards this effort and

8 we're still going in the wrong direction.

9 EXECUTIVE OFFICER WITHERSPOON: With respect to

10 the letter from CAPCOA, we are relying on air districts,

11 and the Bay Area Area District is a leader in this

12 respect, to look back at the stationary source rules they

13 have adopted and where they might embellish them to

14 accomplish greenhouse gas reductions, and that would be a

15 huge time saver from -- for us, if they do that. We can,

16 then, convert it into regulations using the power that we

17 have or air districts can do it themselves.

18 On CEQA mitigation, there is a very lively dialog

19 going on right now. The attorney general has brought suit

20 against various jurisdictions in California for failure to

21 consider greenhouse gases in 30 year general plans, for

22 example. However, no one has a theory of the threshold of

23 significance for greenhouse gas control, what constitutes

24 appropriate mitigation, whether we should be handling this

25 as a planning responsibility or project by project. And

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234589

1 we have a lot of concerns about where it's headed, and so

2 does the Governor's office. And, in fact, we have a

3 meeting with the attorney general on Monday to talk

4 through all of that. So we haven't haven't ignored these

5 proposals.

6 The one thing I do find very ironic and

7 concerning is that ARB was given the responsibility to

8 implement AB 32 because of our reputation for excellence.

9 And yet we're being asked to do things differently than we

10 have done for the last 30 years. And I would hate to see

11 us, in haste, put together ill-considered, legally

12 vulnerable regulations with a great amount of discord from

13 the stakeholder community. We have to work it through, so

14 that they can endure, and so, unlike all of our other

15 regs, except motor vehicle, we want them to inspire other

16 states and nations to copy us, so they need to be clean.

17 And appealing. And easy to implement. Because if the

18 other nations don't follow us, we haven't saved the plant.

19 So that's another one for our objectives.

20 SUPERVISOR HILL: All right. Thank you.

21 CHAIRPERSON SAWYER: Let me note that our web

22 cast apparently is not up, as I've announced. But

23 everything has been recorded. And will be available at a

24 later time. I realize that that's a disappointment to the

25 people who like to watch the web cast while we're going

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234590

1 on.

2 Is there any way to -- is there a message on the

3 site saying that it's down so that they know what's going

4 on.

5 Professor Sperling.

6 BOARD MEMBER SPERLING: Yes. You know, first,

7 I'd like to start by kind of taking the big picture here,

8 you know, responding to this question about how fast are

9 we moving and where we're going.

10 Many of us are inpatient, you know. We'd like to

11 see a lot of progress. And I have been one of those that

12 have been impatient in terms of getting more items on the

13 early action list and getting going. But it is also true

14 that, as Ms. Witherspoon just said, you know, we got to

15 make sure we do this right. And I'm, I have to say, I'm

16 reassured that we are, that the ARB, the staff is gearing

17 up. It is taking on, it is being trans -- the agency is

18 being transformed, just like much of what our economy is

19 going to be transformed over the next ten, 20, 30 years.

20 And we need to make sure we do do it right.

21 You know, we've had a bad experience in

22 California a few years ago with the electricity

23 deregulation. We want to make sure we do get it right

24 this way. But, you know, on the other hand, we do need to

25 push forward aggressively. There is a lot to do. And I

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234591

1 would like to just leave it, that one comment, I have some

2 other comments, but for this one comment is that, you

3 know, what we need to do is support the staff, work with

4 the staff, and that means, "we," I mean all of the

5 interest groups, stakeholders, all the people of

6 California because this is very hard.

7 And the second point that that leads to is that

8 this really is a team effort, here. This is not, you

9 know, you can't just say ARB has to do it. There's other

10 agencies that have to do it. There's other stakeholders.

11 And in the end, it's us as individuals. We have to

12 recognize that the world is changing. And I mean that in

13 several different levels. And we do need to be thinking

14 about how do we -- how can we be more energy efficient,

15 how can we use, adopt practices that are generating less

16 carbon and less fluorocarbons and other greenhouse gases?

17 And so, I mean, this is something that we're all

18 in together here. And I think we need to understand that

19 and proceed in that way.

20 Now, let me address specifically the Low Carbon

21 Fuel Standard since that's something I've devoted much of

22 my life to over the last six months, is trying to help

23 come up with recommendations on how to make that work.

24 And, you know, out of it has come several lessons, and

25 that is that when we try to do something different that

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234592

1 we've never done before, there's a lot of new inventing

2 that happens and there's a lot of concerns that none of us

3 can understand fully. So we've, the group of about 20

4 researchers that I've been working with from U.C., we've

5 been meeting with all the stakeholders. We've had long,

6 long meetings with the environmental groups, with the oil

7 companies, with the electric utilities. And spent a lot

8 of time trying to understand how can we do this in a way

9 that is cost-effective, that is effective?

10 And, but it's something that we need to

11 understand. This is a broad comment for all of what we're

12 doing is, we need to be encouraging innovation. And

13 really, we're in this for the long haul. And so I think

14 we need to be careful about this cost-effectiveness

15 argument, because what's cost-effective today is not

16 what's cost-effective in five years or ten years. And

17 that's what we need to be thinking about. How do we spur

18 innovation? And it's innovation by individuals, by

19 companies, by agencies and how to do that.

20 So with the Low Carbon Fuel Standard, we've come

21 up, I think, with an idea here, we, broadly speaking,

22 which is a broad, durable framework for moving towards a

23 low carbon future. It's not perfect. In theory, you

24 know, I've got some economists on our staff, they're

25 telling us, you know, there's theoretically better ways to

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234593

1 do it. But in practice, I've been convinced it's the most

2 effective strategy that we can use to get major reductions

3 in carbon in the transportation sector.

4 Now, you know, to specifically respond to some of

5 the concerns from the Environmental Justice Committee, you

6 know, we do want to do it in a way that's sustainable. We

7 don't want, you know, backsliding on air pollution or

8 other environmental impacts. That's certainly not the

9 effect. But it can be designed, and the recommendations

10 that our team has come up with are structured in such a

11 way that there should be essentially no -- none of this --

12 there wouldn't be any backsliding. To take the air

13 pollution, in fact, with the air pollution there will be

14 benefits because the point of it is to switch to electric

15 options and other low carbon and low polluting options.

16 So to the extent it's effective, it's actually going to

17 reduce air -- conventional air pollution and local air

18 pollution, because even where you have more electricity

19 used, most of it is in relatively remote areas. And

20 you're taking away the pollution from the diesel vehicles

21 and the gasoline vehicles that are close to where people

22 live. So the exposure should go down.

23 And there should be little or no effect on food

24 because the way it will be structured is there's a carbon

25 metric, the whole point of this is reducing carbon. And

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234594

1 the one food concern we have is with corn ethanol and

2 almost no one I know in California -- well, I shouldn't --

3 that's overstating it. Most of us are skeptical of corn

4 ethanol. And, in fact, the way the carbon metric is setup

5 is that corn ethanol only has a very small benefit in

6 terms of greenhouse gases. So there will be very little

7 incentive to use corn ethanol through the Low Carbon Fuel

8 Standard and, therefore, almost no effect on food.

9 And the focus of it is the energy options that

10 provide large reduction, the cellulosic options, which is

11 not food, and, in fact, a lot of waste materials and other

12 options, but not on food.

13 So there -- you know, it's legitimate to raise

14 these questions, but I think in the end they are very

15 minor considerations and that the overall benefit of this

16 is so huge and it's so important to the future of

17 California and the world. And I note that the European

18 Union is adopting something very similar to this. We're

19 working closely with them. We're working in Washington,

20 helping them build in carbon metrics into all of their

21 programs.

22 So, you know, just to summarize, this is

23 something that is very important. It's one of those rare

24 times where we come up with an idea that really is broad

25 and durable and really can have a revolutionary affect on

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234595

1 how we deal with our transportation sector. And the

2 co-benefits here are huge. And it's not just, it reduces

3 air pollution, conventional air pollution, local air

4 pollution, and it reduces oil imports. And oil

5 consumption in the world, which will lead to all kind of

6 other benefits.

7 So if there was ever a good idea, and that I've

8 come across, you know, this is it.

9 Sorry for talking so much.

10 CHAIRPERSON SAWYER: Thank you.

11 Ms. Kennard.

12 BOARD MEMBER KENNARD: Thank you, Dr. Sawyer.

13 I actually have a very simple process question.

14 And the first one is to Ms. Johnson-Meszaros.

15 In your presentation, you alluded to some

16 alternatives to the Low Carbon Fuel Standard. Of course,

17 you weren't very specific for good reason of time. But I

18 wanted to make sure that each of those initiatives that

19 the EJ Committee proposed were, in fact, in your mind,

20 adequately analyzed by staff.

21 MS. JOHNSON-MESZAROS: For the Low Carbon Fuel

22 Standard?

23 BOARD MEMBER KENNARD: The alternatives to -- you

24 alluded to some, some alternatives to those.

25 MS. JOHNSON-MESZAROS: I think that we alluded to

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234596

1 alternatives for HFC reductions and not for the Low Carbon

2 Fuel Standard. Our recommendation on the Low Carbon Fuel

3 Standard is that it move forward because we agree, that

4 it's a good idea and it's got a lot of possible benefits,

5 if done correctly. But we don't have an alternative to

6 that.

7 BOARD MEMBER KENNARD: I apologize. On your

8 slide, on your slide, it recommends four things. Your

9 third bullet is to replace the Low Carbon Fuel Standard --

10 MS. JOHNSON-MESZAROS: Oh, yes.

11 BOARD MEMBER KENNARD: -- with, with

12 alternatives. And, perhaps, I'm confused.

13 MS. JOHNSON-MESZAROS: I'm sorry. So what we're

14 recommending is, we recommended a series of possible

15 actions that we've taken from the staff's report, the

16 things that are outlined in Group Two. And so essentially

17 what we're recommending is that for the effort that would

18 be spent on the compressed time frame for developing the

19 Low Carbon Fuel Standard, that the staff go back and

20 prioritize those measures that are in the Group Two table,

21 that have also co-pollutant reduction benefits, and we

22 think the highest candidates for those would be those

23 measures that impact the ports, the refineries, the cement

24 industry, and the energy infrastructure. And to move

25 those items onto, onto the early action list. That way,

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234597

1 you'd be able to get reductions -- you assure reductions

2 in the early action process. And also combined with the

3 idea of having the broader list, the more robust list,

4 will allow development of measures, and if some have to

5 moved off the list because they don't meet the

6 cost-effectiveness standard or run into other problems at

7 the end of the early action period, you will be working on

8 a sufficient mix of things that are fully developed,

9 things that you can do in partnership with others, things

10 that have high reduction potential, that at the end of the

11 period, you actually have reductions that will be

12 implemented.

13 BOARD MEMBER KENNARD: Thank you.

14 And so my second question is to staff as to

15 whether or not these recommendations were clearly

16 identified enough for you to evaluate their feasibility?

17 EXECUTIVE OFFICER WITHERSPOON: Yes, they were.

18 And at any time that the Board wishes, we can go through

19 the specific 34 measures that came to us from the

20 Environmental Justice Committee and talk about our review

21 of each one.

22 But just on this point of replacing Low Carbon

23 Fuel Standard with essentially measures that are more

24 oriented to diesel control and criteria pollutant control,

25 they don't come close and the kinds of tonnages we're

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234598

1 after, the estimated benefit from low carbon fuel is ten

2 to 20 million metric tons. Of the alternatives

3 recommended here, the only one we were able to quantify is

4 port electrification and that's half a ton.

5 So we don't have an estimate for refinery or the

6 cement measures, which are essentially energy efficiency

7 at cement plants. And they would have something on that

8 order, but we don't know exactly, they would not approach

9 ten to 20 million metric tons.

10 BOARD MEMBER KENNARD: Thank you very much.

11 CHAIRPERSON SAWYER: Mrs. Riordan.

12 BOARD MEMBER RIORDAN: Yes. Both presentations

13 were excellent. Appreciated the Committee very much.

14 Let me ask a question, and I think it was said,

15 and I'm not sure that I heard the exact on landfill

16 methane capture. Of the landfills that California has,

17 how many are, at this point, just really unregulated.

18 DEPUTY EXECUTIVE OFFICER SCHEIBLE: By number,

19 it's a minority. By size of waste in them, it's a very,

20 very small minority, in terms of ones that do not have to

21 have collection systems in place.

22 BOARD MEMBER RIORDAN: Okay.

23 DEPUTY EXECUTIVE OFFICER SCHEIBLE: But our

24 measure is looking at two things. One is seeing whether

25 or not, with the global warming concern, it makes sense to

PETERS SHORTHAND REPORTING CORPORATION (916) 362-234599

1 say no, those smaller landfills that didn't seem to pose a

2 threat before, have cost-effective emission reductions.

3 And, second, when you look at the, one, the

4 existing inventory comes mostly from controlled landfills

5 and the number is quite large, so our -- and the

6 differences in the estimates from the landfills varies

7 tremendously from area to area.

8 So it looks to us like there is a likely case

9 where we will go in and find a number of things. One is

10 we will improve the emission estimate. And, two, we will

11 likely find ways of reducing emissions at the existing

12 landfills and doing that fairly quickly.

13 BOARD MEMBER RIORDAN: Okay.

14 EXECUTIVE OFFICER WITHERSPOON: Ms. Riordan, the

15 Executive Director of the California Integrated Waste

16 Management Board is here today. He's the first speaker on

17 the witness list.

18 BOARD MEMBER RIORDAN: Oh, oh, I didn't look at

19 the list.

20 EXECUTIVE OFFICER WITHERSPOON: And I'm sure

21 he'll be happy to elaborate on what Mr. Scheible just

22 said.

23 BOARD MEMBER RIORDAN: Okay.

24 DEPUTY EXECUTIVE OFFICER SCHEIBLE: And it's very

25 much a partnership with them, and what we have now under

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345100

1 AB 32 is some authority that we can use, together with

2 their authority to, we believe, more effectively control

3 methane from landfills.

4 BOARD MEMBER RIORDAN: Well, as Dr. Sperling

5 said, in the category of the low carbon fuels and

6 co-benefits that may come. And I see the same thing with

7 working with our landfills because I think the use of

8 methane gas could be, you know, something that we would

9 like to explore opportunities. There's, in my mind, some

10 real opportunities for that, that may be not known today,

11 but as we look at it in the future, it could be very, very

12 helpful.

13 I would also like to encourage staff, when I

14 looked at your protocols, the forestry protocol is one the

15 Registry looked at and it's pretty well along. You might

16 want to bring that on early so we all get some practice at

17 how to deal with a protocol and how the Board would

18 respond and the stakeholders. And I think it would be a

19 good example to work with because it's pretty well sorted

20 out, in my mind, at this point in time. And so give it a

21 try.

22 EXECUTIVE OFFICER WITHERSPOON: That was actually

23 our favorite one along with methane digesters and we

24 wanted to bring it to you before the end of this year.

25 BOARD MEMBER RIORDAN: Great.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345101

1 EXECUTIVE OFFICER WITHERSPOON: Other issues have

2 arisen since then. And so the initial step on the

3 forestry protocol is a full-day symposium in November, at

4 which time everyone will become educated about what's in

5 the protocol and what are the issues about it. And then

6 we'll bring it to the Board.

7 BOARD MEMBER RIORDAN: Great.

8 EXECUTIVE OFFICER WITHERSPOON: And all of the

9 stakeholders are very glad that we're doing that process

10 first.

11 BOARD MEMBER RIORDAN: Right. Because that would

12 be a a good example and one to really work on as a --

13 EXECUTIVE OFFICER WITHERSPOON: We agree.

14 BOARD MEMBER RIORDAN: -- kind of a first, first

15 out of the box.

16 CHAIRPERSON SAWYER: Supervisor Case.

17 BOARD MEMBER CASE: Yes. I, too, would like to

18 say that the presentations were very thorough and helpful.

19 I really appreciate all the work that you've done going

20 forward. And I also would like to say thank you to the

21 Environmental Justice Advisory Committee for all the hard

22 work you've done in tracking this.

23 I really appreciated your PowerPoint that you

24 gave for us to take a look at what were the concerns of

25 your Committee and how we can move forward. When I read

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345102

1 the proposals for items to be included, I was also struck

2 with all the eggs in one basket phenomenon, that it did

3 seem we had 20 million metric equivalents in that one

4 basket and one here, and the numbers were smaller for the

5 other two proposals.

6 So that being said, I'd kind of like to hear a

7 staff reaction. Is it because you see it as something

8 that the further you get into it, the broader the

9 implications and the potential benefits to doing it? And

10 I also understand there's huge co-benefit potential with

11 that, and as a resident of San Joaquin Valley, we're

12 looking for every opportunity we can with the problems

13 with air pollution in the region.

14 But, I guess, just in terms of a response,

15 because I think what the Committee brought forward really

16 some reasonableness to it.

17 EXECUTIVE OFFICER WITHERSPOON: Supervisor Case,

18 one of the things we didn't present to you today is what

19 the other Climate Action Team members are doing. And so

20 for the Air Resources Board alone, our two largest levers

21 are cars, which we've already regulated, and fuels, which

22 we're proposing to regulate. And then there's a galaxy of

23 refrigerant related measures where the next biggest set of

24 tons are, commercial refrigeration is the next one down

25 the list. And every thing else, as you've pointed out, is

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345103

1 small.

2 With our sister agencies, the energy measures are

3 the most powerful and there's 40-odd tons associated with

4 those. With forestry, if we can improve sequestration,

5 there's 20 to 30 tons there. With better land use and

6 reduced vehicle travel, there's another 15, 20 tons there.

7 That's something that business, transportation, and

8 housing and Caltrans are working on, and, yesterday, I was

9 at a workshop they held with metropolitan planning

10 agencies to talk through those possibilities. You know,

11 how we lay out communities such that people don't have to

12 drive as much. Because if you think about all of it, we

13 need to use 25 percent less electricity, 25 percent less

14 fuel, 25 percent less water, where water needs to be

15 pumped and consumes electricity. Those are sort of the

16 main objectives of this climate change work. And it's in

17 every place you can imagine.

18 So we don't have an empty basket. We have a lot

19 of partners working with us, and one correction to staff

20 presentation, the public workshop in Sacramento is

21 actually next Tuesday, not Monday. And we'll be there

22 with our partners going through all of their strategies as

23 well.

24 BOARD MEMBER CASE: Well, the other item that is

25 in a lot of the comments that were made, in writing, was

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345104

1 in regards to the refrigerants, looking at alternative

2 strategies potentially. Will we be getting move

3 information on that as we move forward?

4 EXECUTIVE OFFICER WITHERSPOON: Yes, you will.

5 In the staff presentation, we noted that both the industry

6 and the Environmental Justice Committee propose

7 alternatives to the ban that we were recommending. And so

8 we're not taking 134a in existing cars off the list. But

9 we're leaving open what kind of regulation we'll bring

10 back to you next fall.

11 BOARD MEMBER CASE: Okay. And then the last

12 comment, I think it's been said by several over Board

13 members in terms of looking at, out of the other items,

14 the forestry protocol adoption appears to be close, that

15 those items might actually be moving forward in terms of

16 meeting some of the same deadlines or very close to the

17 same deadlines, if it's possible to be able to make those,

18 so we get everything included we possibly can.

19 Thank you, Dr. Sawyer.

20 CHAIRPERSON SAWYER: Supervisor Hill.

21 SUPERVISOR HILL: Thank you, Mr. Chair.

22 Again, thank you to the Environmental Justice

23 Advisory Committee for the suggestions, and especially the

24 discrete early action measures that were suggested by the

25 Committee.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345105

1 As we did last week in Fresno with the

2 San Joaquin SIP, it was kind of a nice exercise and effort

3 to, for the staff to, may be during the testimony, to go

4 through the 34 items that they have listed and, perhaps

5 briefly, give us an explanation or a status of where these

6 will fall into, either early action or early action plus

7 as we move forward. I think that would be very helpful

8 for us to see exactly how they fit it into the program.

9 EXECUTIVE OFFICER WITHERSPOON: We would like to

10 do that now, and if we could bring those slides up,

11 Mr. Scheible is going to work through the 34 proposals.

12 SUPERVISOR HILL: You're one step ahead of me, as

13 always.

14 CHAIRPERSON SAWYER: You know, I think we're

15 reaching the point where we really need to take a break.

16 And so why don't we take a ten-minute break now, then

17 we'll come back and deal with the 34 items. Thank you.

18 (Thereupon, a recess was taken.)

19 CHAIRPERSON SAWYER: Mr. Scheible, we'll resume

20 with your presentation.

21 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Okay. Thank

22 you. If you start the three-minute clock now, I'll try to

23 do this expeditiously, with the caveat that I'm not going

24 to do justice to, obviously, to all of the proposals

25 because the amount of time doesn't allow it.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345106

1 And I'm also working off the list that says, "ARB

2 Discrete Early Action Measures as Proposed by the

3 Environmental Justice Advisory Committee," by number.

4 So the first one's easy, Landfill Methane

5 Capture. We both agree that should be an early action

6 measure.

7 --o0o--

8 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Number two is

9 additional reductions in HFC emissions from various

10 aspects of refrigeration. We intend to go through the

11 entire list of areas where refrigerants are leaking out.

12 We just couldn't see doing all of that in time for early

13 action.

14 --o0o--

15 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Manure

16 management is on our list as a level two.

17 --o0o--

18 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Reducing

19 venting and leaks from oil and gas systems. The Public

20 Utilities Commission has an open proceeding looking at the

21 nature gas sector and that's going to be a major aspect of

22 their rulemaking. We are fully participating in terms of

23 reducing leaks with the delivery of natural gas on the oil

24 systems for production activity. The oil production

25 sector is a major sector we're going to look at as we're

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345107

1 doing the scoping plan to try to determine what we can do

2 with performance-based measures and what we can do with a

3 possible market system.

4 I'm going to ask Tom to address number five and

5 six, heavy-duty vehicle emission efficiency and cool

6 automotive paints.

7 --o0o--

8 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: On

9 improving proving the efficiency of heavy-duty on-road

10 trucks, we are looking at that as part of the retrofit

11 rule. And so we will be, hopefully, coming and proposing

12 something to you next, mid-next year. And it's not on the

13 early action list because we're not clear at this point

14 whether it would be a regulatory thing or whether we could

15 also -- we're also looking at financial incentives.

16 --o0o--

17 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: On cool

18 automobile paints, we've done quite a bit of work. We

19 have a staff person working on that already. But as we've

20 worked on it, we found that there may be more

21 opportunities to get larger reductions by using better

22 glass in cars and also by downsizing the air conditioner.

23 So we may have more opportunity there, but those do have a

24 little bit of complexity which make them somewhat unlikely

25 to be done by the --

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345108

1 CHAIRPERSON SAWYER: Would you say a little bit

2 more about how that particular one is better handled

3 independent of what we're doing under PAVLY.

4 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Well,

5 when we first, Commissioner Rosenfeld at the Energy

6 Commission is an advocate of cool everything, and he's

7 done a tremendous amount of work on this pioneering work.

8 And so when we first came to our attention, it was to be

9 able to use a different kind of paint that basically

10 results in less heat gain inside the car. And that's what

11 we started working on.

12 And so that looked like simple, straightforward,

13 no need to integrate it with any other kind of rule.

14 Could be done as a stand-up regulation. But as we got

15 into it, we identified other opportunities as well. It

16 doesn't really -- it could be included in a PAVLY-type

17 thing, but it also, I think, merits stand-alone

18 regulation. There's not an obvious synergy of putting

19 them together.

20 CHAIRPERSON SAWYER: And this is existing

21 technology for which the scientific understanding is

22 sound?

23 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yes.

24 We did due diligence on it, which is why it was on the

25 table two, because we haven't done that yet. And for the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345109

1 paint alone, it, we seem to think we have almost all of

2 the information that we need to move forward.

3 But on the glass, you know, sort of the kind of

4 high tech glass you have in your houses can be used on

5 cars and we're looking at how the lower heat load would

6 allow the air conditioner be smaller which gives you more

7 CO2 reductions from the actual operation of the air

8 conditioner. That interaction, I think, is a little bit

9 more complicated, less available information, and would

10 take more data gathering, therefore, we think we won't be

11 able to do it into 2009.

12 CHAIRPERSON SAWYER: On the other hand, I believe

13 that there are companies marketing low transivity glass

14 for motor vehicles to the auto industry right now.

15 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yes.

16 In fact, it's used on some cars, PBG is doing it. It's

17 really the, I think the biggest piece is trying to figure

18 out how it all interacts with the amount of cooling needed

19 for the cars, to make sure what we do wouldn't end up with

20 cars that don't satisfy the customers because they're too

21 hot.

22 CHAIRPERSON SAWYER: Sure. So are there gains

23 independent of downsizing the air conditioning system? I

24 assume the air conditioning system would work less if you

25 had such paint and glazing on automobiles. Even if it

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345110

1 weren't downsized.

2 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yes.

3 It would work less, which is where you get -- where we've

4 calculated the initial, from the paint, the initial one to

5 two megatons in reduction is just from not turning it on

6 because the car never got hot enough with this cool paint.

7 But if you can downsize it, then you can make the air

8 conditioner work more efficiently, because you really want

9 it to work almost all the time when it is needed and

10 that's where you can gain some additional efficiency

11 gains.

12 CHAIRPERSON SAWYER: And cool paints, is that a

13 technology which limits the consumer's choice of color.

14 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: No,

15 there's cool black and there's cool white, so it's

16 everything in between.

17 CHAIRPERSON SAWYER: Thank you very much.

18 --o0o--

19 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Okay. Number

20 seven was port electrification. We're actually working on

21 that on three fronts. One, we're working with the ports

22 of L.A. and Long Beach in their extensive effort to put

23 that into their lease agreements and to provide for that

24 through their tariffs.

25 Second, we think that's a candidate, attractive

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345111

1 candidate for bond funding as we go ahead for other ports

2 in other areas and also in the port of L.A.

3 And, third, in all likelihood, we will bring you

4 a regulatory proposal that says if these facilities exist

5 and you have a ship that otherwise comes frequently,

6 you're going to be obligated to do it. It's not

7 attractive as early action because it's probably going to

8 not be cost-effective as a CO2 emission reduction measure,

9 but we'll have great co-benefits once we do it for NOx and

10 smog and PM reductions.

11 --o0o--

12 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Truck stop

13 electrification -- no, wait a minute. Excuse me.

14 Number eight, is transportation refrigeration

15 electric standby. We investigated that when we did the

16 rulemaking for the TRU rules, and we'll look at it again

17 in light of global warming. It was, again, a costly

18 proposition because of, it's very expensive to install the

19 electrical power. If you a unit and it can be hooked in,

20 it ought to be. So we'll have to look at that one more

21 time.

22 Also, the Low Carbon Fuel Standard may provide

23 some additional incentive because if you switch to

24 electricity rather than diesel fuel, you would be

25 generating credits under the Low Carbon Fuel Standard.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345112

1 --o0o--

2 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Truck stop

3 electrification, largely that's been -- emission

4 reductions have been accomplishing because the Board

5 requires, starting next year, that overnight trucks do not

6 use their main engines unless they meet stringent emission

7 control criteria.

8 EXECUTIVE OFFICER WITHERSPOON: We're also

9 working with Board Member Dee Dee D'Adamo to accomplish

10 more incentive funding for the installation of electrified

11 truck stops so that truckers have access to these.

12 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Thank you.

13 I've got to say, to implement that rule, we'll look at how

14 to do electrification and other options.

15 --o0o--

16 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Tire

17 inflation programs is on the list of, in our Group Two

18 measures and we're trying to figure out the right mix of

19 public information requirements that that information be

20 presented at the pumps or some sort of compulsory program

21 that when your car gets serviced, the tires, and the car

22 leaves, we know the tires are inflated.

23 Tom, could you address number 11 and 12. I think

24 both of them are ongoing as part of our efforts.

25 --o0o--

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1 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Right.

2 We already, for low GWP refrigerants in motor vehicles, we

3 already have credits built into the Pavley program. So

4 right now, it serves as an alternative to reducing CO2

5 from the tailpipe. But as we go to Pavley Two, which is

6 going to be in the, something in the 2010 time frame,

7 we'll look at whether these refrigerants should just be

8 mandated. And there's a lot of development of new

9 refrigerants going on, so it's worthy to take the time to

10 see what actually is coming out in the marketplace.

11 --o0o--

12 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: And on

13 the leak tightness, sort of an air conditioning check for,

14 to be performed during smog check, that -- we don't really

15 have good instrumentation yet to do that or not

16 well-proven instrumentation. So there's a little bit of

17 development time there. And, quite frankly, that

18 department does regulations on a different schedule than

19 we do, that doesn't suggest that early action is possible.

20 --o0o--

21 DEPUTY EXECUTIVE OFFICER SCHEIBLE: On the waffle

22 mat system for concrete slab foundations, that's a new

23 idea, sounds to me like something we should put in to our

24 local government development protocol, because as

25 development goes ahead, that might be a way of saving the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345114

1 amount of concrete used and have other benefits. So we'll

2 be looking at many ideas like that.

3 EXECUTIVE OFFICER WITHERSPOON: And the

4 California Building Industry Coalition Pollution

5 Association, is working on an analysis of the carbon

6 footprint of new housing, and they're coming to see us in

7 the next two weeks. And so we're going to add to this to

8 their list of investigations, the concrete system under

9 the house.

10 --o0o--

11 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Number 14 is

12 demonstrate use of shore side generators to bridge

13 electrical hookups. These would be for ships that call

14 infrequently and would be a lower cost way of providing

15 shore power. We're participating in a project to figure

16 out how much that costs demonstrate the technology and it

17 will likely be incorporated as part of our effort in the

18 rulemaking for port electrification.

19 --o0o--

20 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Green ship

21 incentive program is something where we've put forth what

22 we think the future ships should look like in goods

23 movement plans, so we'll handle it under there.

24 --o0o--

25 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Anti-idling

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345115

1 requirement for cargo handling equipment at ports. This

2 would be a very small measure, but it may make sense so

3 we'll to look at it as part of our ongoing diesel

4 reduction plan.

5 --o0o--

6 DEPUTY EXECUTIVE OFFICER SCHEIBLE: And the same

7 thing requiring electrification of construction equipment

8 at urban sites. I think that will be covered in some

9 extent under the construction rule as a credit. And,

10 also, again, it's a candidate for the Low Carbon Fuel

11 Standard, in that we will be, in that effort, encouraging

12 the use of lower carbon fuels and electricity as a great

13 option in the heavy-duty arena.

14 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: You

15 skipped 17.

16 DEPUTY EXECUTIVE OFFICER SCHEIBLE: I skipped 17.

17 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: You

18 want me to do that one?

19 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Sure.

20 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: On 17,

21 it's electrification of airport ground support equipment,

22 like baggage tugs and push back equipment. And right now,

23 because of an earlier MOU and then ultimately a

24 regulation, we're already at 35 percent in the Los Angeles

25 area, at least of equipment is now electrified. And

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345116

1 there's an upper limit because the electrification just is

2 not, doesn't serve the duty cycle for some of the types of

3 equipment that's being used. So while there might be some

4 more that can be done to push there, I don't -- that

5 wasn't one that came real high on our priority list.

6 --o0o--

7 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Number 19,

8 Tom.

9 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Oh,

10 missed that one. Didn't have that one marked.

11 --o0o--

12 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: We're

13 looking at the issue of whether a CO2 standard for what

14 medium-duty trucks, it's like the delivery truck category,

15 FedEx-type trucks in, of that size, urban trucks, whether

16 or not we could require hydroelectric technology which

17 would typically give you 25 or greater percent reduction

18 in CO2.

19 Right now, the technology in that sector is just

20 emerging. Unlike in cars where it's commercial. And

21 we're having to look at the costs, which are very high

22 right now, and how quickly they'll come down. And so our

23 assessment, that we couldn't really come up with the good

24 information and there's not enough time to allow the

25 technology to drop in costs within the sort of 18-month

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1 period that we've been talking about for early action.

2 But we will pursue this one, one way or the other.

3 --o0o--

4 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Okay. Number

5 20 and 21 both effect the cement industry.

6 That is, again, another major sector in terms of

7 the industrial sector that contributes global warming

8 gases in California. So we're going to be looking at that

9 as we develop the scoping plan to say what are the

10 opportunities, what are the best performers, where can

11 emissions be accomplished, and what should be done to

12 performance standards versus what should be done by

13 placing a cap on the emissions from the industry.

14 --o0o--

15 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Number 22 is

16 a similar measure in terms of energy saving measures for

17 power plants. That, and I'll mention later on several

18 other measures, are all in our effort with the California

19 Energy Commission and the Public Utility Commission to

20 design a system of saying what is the performance that can

21 be expected and emission reductions that can be had out of

22 the utility sector and the electric generation.

23 So we're very reluctant to take one-on-one

24 proposals forth because that has to be treated as a system

25 where we do energy efficiency, renewable portfolio, back

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345118

1 out use of coal resources, and keep the lights on all at

2 the same time. And upgrading power plants and things like

3 that will be a primary consideration in how emissions

4 could be reduced and system reliability could be improved.

5 --o0o--

6 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Number 24 is

7 accelerate the replacement of cargo handling equipment at

8 the ports. We would have to revisit our rule to do that.

9 But quite frankly, the ports of Los Angeles and Long Beach

10 are working very hard to do that as part of their lease

11 agreement. So we'll work on that effort with them.

12 --o0o--

13 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Number 25,

14 enclose dairy barns to capture methane. We think that

15 that's probably a pretty small measure because the vast

16 majority of dairy cattle are not in enclosed facilities

17 anymore. They're in large, large feed operations, so, and

18 we're going to look at the methane manure management and

19 then methane digesters. So that whole industry is being

20 covered through other efforts.

21 --o0o--

22 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Adopt South

23 Coast and San Joaquin rules on enclosed compacting,

24 composting facilities. We'll have to work with those

25 districts and do a cost assessment to see whether or not

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345119

1 those rules could pass as a CO2 reduction measure or

2 methane reduction measure.

3 We can probably incorporate some of that effort,

4 it's a landfill measure, but I don't think we can commit

5 to doing it as a regulation until we learn more.

6 --o0o--

7 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Number 27,

8 the phase out of older power plants. And, again, that's

9 in the electricity sector work that we're doing with the

10 PUC and the CEC.

11 --o0o--

12 DEPUTY EXECUTIVE OFFICER SCHEIBLE: The same is

13 true of number 28. And I just need to note that there

14 really isn't any base load generation being done with oil

15 in California. The plants that have the capability of

16 using oil, use it only when natural gas is curtailed and

17 it's a very, very small percentage of their operation and

18 not something we can take on without severely impacting

19 reliability when we have cold spells and those types of

20 instances. But I think as a goal, we would agree that we

21 need to get the cleaner fuel substituted for those plants.

22 --o0o--

23 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Number 29

24 affects refineries and we're working at that in the

25 refining sector as we put together the scoping plan.

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1 --o0o--

2 DEPUTY EXECUTIVE OFFICER SCHEIBLE: The same with

3 number 30.

4 --o0o--

5 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Number 31 is

6 the same industry sector. So that will be looked at

7 comprehensively.

8 --o0o--

9 DEPUTY EXECUTIVE OFFICER SCHEIBLE: And number 32

10 is the same.

11 --o0o--

12 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Thirty-three

13 looks at oil production sites. And that, as I said

14 before, is a major source to, the fifth major source

15 category and we will be looking at oil production

16 holistically so say what can we do, are there ways we can

17 more efficiently inject steam into wells and lower CO2

18 emission reductions and what's the right mix of

19 performance standards versus a cap on the sector.

20 --o0o--

21 DEPUTY EXECUTIVE OFFICER SCHEIBLE: And number 34

22 is the same one.

23 So again, I apologize, I really can't, in the

24 time, do justice to all of those, but I think, as you can

25 see, all of the ideas are in our process in one way or the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345121

1 other. And most of them are in it so that we can be

2 pretty definitive by the end of next year in telling you

3 the type of approach we intend to take, if we find there

4 are substantial emission reductions and opportunities to

5 proceed.

6 CHAIRPERSON SAWYER: Thank you very much.

7 I must say that I'm struck by the number of items

8 on this list and the potential of most of them to provide

9 substantial reductions.

10 Many of them involve electrification. And I

11 think those that involve electrification immediately bring

12 up the issue of co-benefits and how we deal with that.

13 Since there is no price at the present time on CO2, but we

14 do have guidelines for NOx, for example, the number of

15 dollars per ton that we think are reasonable for making

16 the cost -- for making effectiveness assessments, how are

17 we going to resolve this issue of co-benefits, and it

18 seems like we should count the benefits of both, for the

19 cost-effective -- in working out the cost-effectiveness,

20 that we shouldn't have to meet cost-effective standards

21 alone for CO2 or NOx, for example.

22 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Well, I think

23 we agree. And it may well turn out that the, even if you

24 assign no benefits to CO2s, many of these measures would

25 be carried by their benefits for smog reduction or diesel

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1 exhaust reduction. It's just a new criteria that we have

2 to apply. If something didn't quite make it for the smog

3 controls or it could be done a little bit more, in light

4 of the global warming controls, that would be a new effort

5 we'd have to do in the policies the Board would have to

6 make in terms of determining what's -- how to split those

7 benefits.

8 CHAIRPERSON SAWYER: And you'll be bringing that

9 to us, I suspect.

10 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Yes. We'll

11 be looking for your advise on that.

12 BOARD MEMBER SPERLING: Chairman, can I add to

13 that.

14 CHAIRMAN SAWYER: Sure.

15 BOARD MEMBER SPERLING: I think this question is

16 so central to this whole initiative. You know, I think

17 you bring up one point and I want to add another that I

18 referred to a bit before is, we need to think about this

19 concept of cost-effectiveness much more broadly and much

20 more fundamentally than we have before, because there's

21 two parts there.

22 One is, you know, what you're talking about,

23 Mike, and that is that there are these strong, large

24 co-benefits. And it's not, there's conventional, you

25 know, there's criteria pollutants in transportation. You

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345123

1 know, there's congestion. You know, the reason why we're

2 going to have to demand management and reduce vehicle

3 miles traveled in transportation is going to be as much or

4 more so because of these congestion externalities that

5 we've been measuring for years. And, you know, now

6 they're starting to use pricing and other mechanisms to

7 internalize those externalities.

8 So somehow, I think we've got to sit down and

9 think through this whole concept of cost-effectiveness,

10 not only in terms of these, you know, we'll call them

11 co-benefits for now. You know, all of these externalities

12 that have not been internalized into the market. And

13 energy security is part of it, of course, also.

14 But also this idea of innovation. We've got to

15 bring that in here because we're talking, in many of these

16 technologies and many of these practices, doing it very

17 differently. And we need new practices, new innovations,

18 new technologies, and ways of doing things. And we can't,

19 you know, if you tried to analyze what are those costs

20 today, you'll come up with a very high number. If you say

21 what will be those costs after we learn by doing and

22 create the institutional ways of handling it as industry

23 invests in them, those costs are going to come down. You

24 know, we've seen with air pollution in vehicles, you know,

25 now we're spending the same amount for air pollution in

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1 our vehicles today as we did 25 years ago, even though the

2 vehicles are, you know, 80 percent cleaner, 80, 90 percent

3 cleaner than they were because of innovation.

4 And so somehow, we've got to figure out a better

5 way. And I think that something -- it's going to be hard,

6 but I think we need a new framework to use in

7 understanding and analyzing this concept of

8 cost-effectiveness. And I don't have an answer. But I

9 know the question.

10 CHAIRPERSON SAWYER: SUPERVISOR Hill.

11 SUPERVISOR HILL: Thank you, Mr. Chair. My

12 thanks very much for the analysis of these.

13 I had a quick question for Tom and, then, if it

14 would be possible for Ms. Johnson to kind of briefly

15 respond to these, to the analysis we just heard, I would

16 appreciate it.

17 Tom, you mentioned under item number 17, the

18 electrification of airport ground support equipment, and

19 you talked specifically of the MOU against with LAX. Are

20 there other MOUs, other airports around the state, that

21 apply to that or what are we doing with those airports?

22 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: No, it

23 was an MOU that applied to the airports of the Los Angeles

24 area. It's actually no longer in effect because the other

25 party walked away from it and then we recaptured the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345125

1 benefit through a regulation, the Board adopted a year and

2 a half ago or so. And so it is in place. But we were

3 able to look at what had happened while the MOU was in

4 place and it was, they had exceeded the original target of

5 30 percent. And we didn't see why it wouldn't continue to

6 increase once the infrastructure is in, up to some level

7 that would match where the electricity can do the job and

8 where it can't.

9 SUPERVISOR HILL: Right. Is that something that

10 can be implemented elsewhere, at other airports. Who

11 would require that?

12 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yeah,

13 right now, that's not required -- well, yeah, it is, it's

14 not required elsewhere. And, but if you look at

15 Sacramento, for example, next time up you'll see that they

16 use a large fraction of electric, and you really notice it

17 at Burbank here, too, where you're close to the airplanes,

18 you can see it. So it's starting to happen on its own.

19 SUPERVISOR HILL: And is that something that

20 could be -- the local districts could work with those

21 airports?

22 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yes.

23 SUPERVISOR HILL: That would -- great. Thank you

24 for that.

25 And if Ms. Johnson could respond, I would

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1 appreciate it.

2 MS. JOHNSON-MESZAROS: Thank you very much. It's

3 a lot of points and, frankly, for better or for worse, I

4 could go on for hours about this issue. And I'm going to

5 try not to. But I do want to raise some overall comments.

6 The first one is the issue around

7 cost-effectiveness. And I couldn't support more the

8 comments of Dr. Sperling on this and having to think about

9 the new criteria for cost-effectiveness. Not only for the

10 CO reductions, the criteria pollutants, the toxics

11 reductions, but also direct -- included in the statute,

12 and I think that something that this agency is

13 particularly interested in is the cost for health impacts,

14 of not engaging in these reductions. And that should be

15 part, and I think AB 32 calls for that to be part, of the

16 cost-effectiveness criteria. The avoided health costs

17 brought about by the reductions.

18 I also thought it was interesting, on some of

19 these I just want to highlight some of the comments from

20 the staff and point out things that I thought were

21 particularly interesting.

22 The first one is on the cool paint item. As I

23 understood the comments about cool paints, what he said

24 was, we could implement the cool paints regulations now.

25 But there are other regulations that we can implement or a

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1 package of measures that we can implement that would even

2 take us further. And it seems to me that when we

3 analogize that to the HFC plan that the staff has put

4 forward, which is there's a package of HFC reductions that

5 could move forward but we're pulling out this one that's

6 going to have this unfortunate disproportionate impact,

7 and moving that forward because we're already there on

8 that one.

9 It's problematic. And the question is how are we

10 going to have parity across the field of things that move

11 forward, and I think that's an example of our basic point,

12 which is, there are opportunities for this Board to make

13 decisions that are going to -- that meet the criteria of

14 the bill such that they don't negatively

15 disproportionately impact communities of color and low

16 income communities. And that cool paints measure is an

17 example of how that can happen and a lack of parity across

18 decision-making about what moves forward.

19 I also, as I understood the comments of the

20 staff, there were several measures that seemed to be on

21 the Group Two list, which is, we pulled our

22 recommendations from, that they seem to be saying, could

23 in fact be done before this 2010 timeline. And so that

24 just takes us back to the point that we raised before

25 which is, if they're moving forward with them and there's

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345128

1 a high likelihood that it can happen, and the staff is

2 taking the position that we should assume for these

3 purposes of putting something on the list that it's going

4 to meet the cost-effectiveness standard, then why not add

5 these items to the early action list? If you do that, you

6 can ensure or better ensure that you're going to be able

7 to get adequate resources in your budget, that there will

8 be adequate attention and focus to those these issues, and

9 to the extent that the measures that we have outlined in

10 our recommendations have the co-pollutant reduction

11 benefits, you can also ensure that you're cleaning up the

12 air and keeping ARB on track with its overall mission.

13 The final thing that I wanted to note is, there

14 is an opportunity which lies before this Board and before

15 this agency right now to really think about, as we think

16 about how we move technology, as we think about how we're

17 going to move forward, to really think about how we're

18 going to move a regulatory package and an approach to

19 addressing in a comprehensive way climate change issues

20 and air quality issues. And frankly, based on the

21 conversation that we're having right now, it seems that

22 what's being proposed is a method forward that looks very

23 much like the method that they've already used. You know,

24 Ms. Witherspoon said in her comments, we've been doing

25 this now for 30 years and they're asking us, ironically,

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345129

1 to change the way we've done it before. And, in fact,

2 that's exactly what we're doing. We're asking them to

3 changed the way that they've done it before. And, yes, it

4 makes people move outside their comfort zone. And, yes,

5 it does mean that you have to be on the cutting edge and

6 to be on the cutting edge, you have to be prepared to have

7 a reasonable mixture of risk. And the currently proposed

8 list, I believe, doesn't have the appropriate mixture of

9 risk that's required to move the state, the country, and

10 the world into the new realities of carbon change and

11 carbon impacts. And what we are urging this Board to do

12 is to seriously consider that and to help to move this

13 agency forward in being a leader that we know ARB has been

14 in the past and ought to be in the future on these issues.

15 CHAIRPERSON SAWYER: Thank you.

16 Okay.

17 (Applause.).

18 CHAIRPERSON SAWYER: Let's begin the public

19 testimony at this time, and we will be enforcing our usual

20 three-minute rule. The first three speakers are Mark

21 Leary, Cathy Reheis-Boyd, and Thomas Jacob.

22 Mr. Leary.

23 MR. LEARY: Good morning, or good afternoon,

24 Dr. Sawyer and members. My name is Mark Leary, I'm the

25 Executive Director of the California Integrated Waste

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345130

1 Management Board. And on behalf of our Chair, Margo

2 Read-Brown, and the rest of the members of the Board, we

3 are in support of the adoption of the proposed early

4 action measures as staff have outlined them for you.

5 And I'd like to offer that this support comes

6 with a commitment. The commitment is that as a state

7 organization charged with the responsibility of ensuring

8 the safe management of solid waste in the state of

9 California, we work commit to work collaboratively with

10 you, the Board, Air Resources Board, and your staff as we

11 move forward to implement AB 32.

12 The inclusion of the landfill methane capture, we

13 believe, is an appropriate early action measure. It's

14 supported by science and it's supported by the data that

15 exists today.

16 In response to Member Riordan's questions or

17 issues and excitement, it sounded like a little bit, in

18 regards to landfill gas, let me put a little context or a

19 a few parameters around it.

20 The -- there are 51 landfills in this state that

21 exceed five million tons in place. The largest of which,

22 of course, is the Puente Hills landfill, which is over a

23 hundred million tons of solid waste disposed in place.

24 That constitutes about, together those 51 landfills,

25 constitute about 76 percent of the total waste in place in

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345131

1 the state. Every single one of those landfills has a

2 methane capture system in place.

3 The landfills that currently do not are quite

4 small, as Mr. Scheible attested earlier. They generally

5 are -- they'll are, in fact, less than 500,000 tons in

6 place. Very much smaller than the 51 that I've just

7 characterized. So we think -- but what we do believe

8 there's an opportunity to effect landfill methane capture

9 in those landfills and that's exactly what this item is

10 about.

11 The rest of the landfills and the component of

12 this capture that the staff have offered to you, there's

13 an analysis of effectiveness that needs to be addressed.

14 And we think that -- and we will work collaboratively to

15 address that effectiveness issue at these landfill, that

16 in fact, currently have a system in place, but the

17 measurement quantification of that effectiveness needs to

18 be realized.

19 And then in regards to the opportunities for

20 landfill gas, further on in the implementation of 32, I

21 imagine we'll be having some conversations about landfill

22 gas to energy. That same Puente Hills facility also has

23 the largest landfill gas to electricity production

24 operation anywhere in the world, about 58 megawatts are

25 being produced from landfill gas at Puente Hills.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345132

1 But there are other exciting projects, and, in

2 fact, the Air Board and the Integrated Waste Management

3 Board have together supported three projects in the state

4 that look to convert landfill gas to liquid nitrogen --

5 liquid natural gas, excuse me -- at a rate that, when in

6 operation, will exceed 40,000 gallons per day.

7 So I think I share Member Riordan's excitement

8 about the opportunity, the win-win scenario of landfill

9 gas to liquefied natural gas is a natural, and we look

10 forward to working with your staff. Together we're going

11 to be addressing as aggressively as possible how the

12 management of solid waste in this state can affect

13 greenhouse gas reductions and we look forward to working

14 with your staff.

15 Thank you.

16 CHAIRPERSON SAWYER: Thank you very much, Mr.

17 Leary. And I certainly appreciate your being here and we

18 look forward to working with the Integrated Waste

19 Management Board using your expertise and our authority

20 under AB 32 to make some real gains in this area.

21 MR. LEARY: Happy to do it, Dr. Sawyer.

22 CHAIRPERSON SAWYER: Ms. Reheis-Boyd, please.

23 MS. REHEIS-BOYD: Good afternoon, Chairman,

24 members of the Board. Oh, I guess I'm done.

25 My name is Cathy Reheis-Boyd, and I'm the Chief

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345133

1 Operating Officer of the Western States Petroleum

2 Association, and we represent clients that produce and

3 transport, refine and market petroleum and petroleum

4 products not only in California but the other five western

5 states.

6 After hearing that excellent presentation from

7 the Environmental Justice Community, perhaps I should ask

8 you not to list this as a discrete early action.

9 Certainly, I'm here to talk about the Low Carbon Fuel

10 Standard and it's nice to be with you again after spending

11 an entire day with you in Fresno last week. I do

12 appreciate the opportunity to comment.

13 As we all know, the decision today to list the

14 Governor's Low Carbon Fuel Standard as a discrete early

15 action to AB 32 is a really significant one. As I've said

16 in the past, they sort of marry up today and become part

17 of the state's program, if you take that action.

18 As we plan the state's future transportation fuel

19 portfolio, we have to get this right. There's too much at

20 stake to not get it right. And we can't afford to get it

21 wrong. And of course, the California consumer will really

22 be the judge of how we do, since they demand reliable,

23 affordable, clean fuel every day, everywhere. And from

24 the legal perspective we appreciate the very limited scope

25 of the Board's decision to list the Low Carbon Fuel

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345134

1 Standard as a discrete early action candidate today. You

2 have appropriately deferred your formal findings and

3 decision on all the details of the low carbon program to

4 your formal rulemaking process. During the next 18

5 months, we look forward to continuing to work with you and

6 your staff, the CEC, and all interested parties to build a

7 solid record that can support a technologically feasible

8 and cost-effective Low Carbon Fuel Standard rule.

9 Linkage to the CEC's AB 1007 transportation plan

10 is very important. As is linking it to part one of the

11 Technical Analysis that the U.C. professors have done and

12 certainly, hopefully, to be released soon, Dr. Sperling,

13 part two, policy analysis. Both of those we viewed as

14 very critical elements to the Low Carbon Fuel Standard

15 success.

16 We all know there's lots of uncertainties

17 underlining this standard. And that they could pose

18 really significant risks, not only to the refiners, but to

19 the state's fuel consumers. And this won't be easy. It's

20 going to take a lot of innovation, as was mentioned,

21 creative thought, continued dialog and rigorous analysis

22 to really achieve what we need to do here. These are

23 aggressive timelines and they're truncated, as was stated

24 by staff. But we're continued to work with you, committed

25 to work with you on this process and I have two

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345135

1 recommendations that I think would help in this process

2 going forward. I've talked about these at your workshops

3 and I've certainly submitted them in comments to you all

4 and the staff.

5 First, given the uncertainties with the modeling

6 tools, we really think it's important as we look at how we

7 compare greenhouse gas emissions from gasoline and diesel

8 compared to other transportation fuel options, that we do

9 this in a collaborative process. And by a collaborative

10 process, I mean getting the best and brightest minds

11 together that we can work on this as we go forward.

12 That's really, really important that we have the necessary

13 tools in place to make this happen.

14 The second recommendation is that we consider

15 milestones, because you have to review your progress

16 against planning.

17 CHAIRPERSON SAWYER: I must ask you to conclude,

18 please.

19 MS. REHEIS-BOYD: And that would be very, very

20 important as we go forward, that we have that process for

21 review.

22 So I'd like to just commend the Board on, and

23 staff, on their continued work. We hope you consider the

24 collaboration. We hope the CARB can host the first

25 stakeholder meeting and perhaps have Professor Sperling be

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345136

1 a liaison from the Board to that process given the linkage

2 to the Low Carbon Fuel Standard, and we look forward to

3 working with you on that idea.

4 CHAIRPERSON SAWYER: Thank you.

5 Mr. Jacob, and then we will have Al Thornton,

6 Norm Plotkin, and Aaron Lowe.

7 MR. JACOB: Thank you, Chair. I'm Tom Jacob with

8 the Du Pont Company. We've submitted written comments to

9 you. I'd like to amplify on just a couple of those.

10 First, we urge you to resist the temptation to

11 accelerate more and more items into being handled through

12 regulation. We've been deeply involved and deeply

13 committed on the climate change frontier since we first

14 started our systematic reductions in 1991. We are strong

15 believers that this is a very long-term challenge that we

16 face. It's a challenge that's going to continue to get

17 deeper and deeper. And we believe that, ultimately, we

18 are going to need market-based solutions, emissions

19 trading in order to ensure that we're using limited

20 capital in the most effective and efficient way to secure

21 reductions. And we think we need to accelerate the path

22 toward market measures, and so we would urge you to use

23 caution in terms of the range of ideas that, or notions

24 that you pull together under a regulatory initiative that

25 could be handled through the marketplace.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345137

1 We think you should give explicit attention to

2 crediting early action. It is going to be a while before

3 this is all up and running. We think it's important to

4 stimulate early action and we think that requires some

5 formal acknowledgement and crediting process.

6 With respect to the specific items, we do support

7 the Low Carbon Fuel Standard. We think the approach

8 that's being taken there is the correct approach. We're

9 very involved with the alternative fuels. But we believe

10 that we are just at the beginning of this process. It's

11 premature to lock in on any fuel type. And we think the

12 life cycle approach has gotten a great infusion of energy

13 and intellectual power through the work of the U.C.

14 report. We commend that. But by the same token, we think

15 with respect to the life cycle, it's integral but we want

16 to make sure that it becomes workable, it gets translated

17 into a workable process, so that it doesn't end up

18 inhibiting the entry into the market of alternative fuels.

19 And finally, just a brief comment on the fire

20 suppression, Group Two item. We think this is premature

21 at best. This is an area where the industry has actually

22 made some extraordinary progress through their voluntary

23 codes. We think the range of options at this point is

24 limited, both in number and use. And in our discussions

25 with staff, it's evident that this hasn't been yet

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345138

1 thoroughly explored. It may be appropriate for future

2 analysis, but we think without prejudging the expected

3 outcomes in terms of regulation or extension of the

4 voluntary program and so forth.

5 And if it moves forward, we would urge that it be

6 reframed as opportunities for further greenhouse gas

7 reductions from fire protection systems.

8 Thank you.

9 SUPERVISOR HILL: Mr. Chair, could I ask --

10 CHAIRPERSON SAWYER: Thank you very much.

11 Yes.

12 SUPERVISOR HILL: -- the witness a question.

13 CHAIRPERSON SAWYER: Supervisor Hill.

14 SUPERVISOR HILL: Thank you, Mr. Chair.

15 Mr. Jacob, it's my understanding that Du Pont is

16 one of the largest manufacturers of automobile paints,

17 coatings. Are you working on a cool automobile paint.

18 MR. JACOB: I can't say that. I'm not aware of

19 that. Although, I would be, frankly, surprised if we

20 aren't, in our research. In our research areas.

21 SUPERVISOR HILL: Okay. Thank you.

22 CHAIRPERSON SAWYER: Thank you.

23 Mr. Thornton.

24 MR. THORNTON: Good afternoon, Dr. Sawyer, fellow

25 Board members. I'd like to restrict my comments following

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345139

1 Mr. Jacob's specifically to the fire suppression, the

2 inclusion of fire suppression in Group Two for additional

3 greenhouse gas reduction measures.

4 The fire suppression community represents

5 manufacturers, local installation and service providers,

6 and end users and has actively pursued responsible

7 environmental policies since the initiation of the

8 protection of the ozone layer for replacement halons.

9 In response to this global environmental crisis,

10 the community came back to the industry very quickly

11 developing safe, effective fire suppression technologies

12 to replace the wide and varied applications protected

13 previously by halon systems. HFC agents are an integral

14 in that protection technology. At present, there are no

15 safer, more cost-effective replacements for HFCs for many

16 of these fire protection applications. HFCs today are

17 only used where a risk assessment by a qualified fire

18 protection engineer concludes that they are the best

19 solution for protecting lives and property.

20 I find it's often easier in some of these

21 technical discussions to put them in terms of realistic

22 practice. Several years ago, there was a woman in an MRI

23 examination in a New York City hospital when the building

24 alarm went off, or what was believed to be the building

25 alarm system went off. The technicians running equipment

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345140

1 assumed it was the building fire alarm and didn't respond.

2 It turns out the MRI equipment was actually on fire. We

3 happen to have an HFC fire suppression system in that

4 enclosure that discharged, the technicians realized that

5 there was a problem and got the woman out of the

6 equipment, unharmed, startled a bit and probably a little

7 worse for wear, but nonetheless, she was fine.

8 In counter to that, in the same eastern city not

9 too far away, there was another woman working in a bank

10 vault late on a Thursday evening when the automatic vault

11 door closed on a timer. The woman was a typical bank

12 employee and she dialed up on the phone to get somebody to

13 open up and let her out. Nobody responded. So being late

14 in the evening, she pulled the fire alarm or what she

15 thought was the fire alarm. It turned out it was a manual

16 release for a CO2 system and it killed her.

17 The back end of that horrible story is that there

18 used to be a halon system in that vault that was pulled

19 out and replaced due to the elimination halon as a fire

20 suppression agent, and was mistakenly replaced with carbon

21 dioxide. If it had remained a halon system, she would

22 still be alive.

23 I offer those as tragic examples of a little bit

24 about what we in the fire industry deal with on a regular

25 basis. These are highly technical applications that

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345141

1 require tools and HFCs are a valuable tool for the

2 protection of life and property.

3 Thank you for your consideration.

4 CHAIRPERSON SAWYER: Thank you. And I think

5 that's, you know, certainly instructions which the Board

6 would carry to the staff that unintended consequences are

7 something, as always, which we really want to avoid and

8 issues of safety are what come to the top of the list, I

9 think, of things to be considered.

10 All right. Mr. Lowe. And then we will have Bill

11 Quest, Rachel Oster, and Robert Wyman.

12 MR. LOWE: What happened to Mr. Plotkin?

13 CHAIRPERSON SAWYER: Oh, excuse me.

14 MR. LOWE: Could I --

15 CHAIRPERSON SAWYER: Are you Mr. Plotkin?

16 MR. LOWE: No, I'm Mr. Lowe.

17 CHAIRPERSON SAWYER: Okay. Well, why don't you

18 go ahead.

19 MR. LOWE: We'd like to ask Mr. Quest to start

20 out and then Mr. Plotkin, and then myself, if that's all

21 right with the Board.

22 CHAIRPERSON SAWYER: Oh, if -- you want to change

23 the order --

24 MR. LOWE: Yeah.

25 CHAIRPERSON SAWYER: -- because, certainly,

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345142

1 that's fine.

2 MR. LOWE: Okay. Thank you.

3 CHAIRPERSON SAWYER: You know if there are

4 similar circumstances where people have testimony that is

5 in a logical order or builds one upon the other, talk to

6 the clerk about doing that and generally we can

7 accommodate it.

8 MR. QUEST: Thank you very much.

9 CHAIRPERSON SAWYER: So this is Mr. Quest.

10 MR. QUEST: Thank you, Dr. Sawyer. My name is

11 Bill Quest and I represent ARPI, which is the Automotive

12 Refrigerant Packagers Institute.

13 Permit me to begin by thanking the CARB staff for

14 its consideration of our proposed alternative that we

15 believe is equally effective to banning the sale of small

16 cans of R-134a refrigerant. We've been working with the

17 CARB staff for sometime. During that time we've shown

18 them surveys from a major independent research firm that

19 is, firm that is disputing and correcting some of the

20 information that was given to them by the automotive

21 service industry. This industry which is made up of car

22 dealers and garages will receive a windfall profit of

23 almost 200 million dollars a year if motorists are

24 prevented from working on their own car's air conditioning

25 and forced to go to a car dealer or a garage.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345143

1 In working with the CARB staff, we've been able

2 to change the installation instructions on the small cans

3 of refrigerant that enable the do-it-yourselfer to leave

4 no greater percentage of residue in the can than is left

5 by the sonar, by the professional mechanic. We're

6 currently working on adding point of sale information on

7 major retailers in California to encourage more

8 responsible use of refrigerant, including reducing the

9 small refrigerant that's lost during charging.

10 Banning the sale of 134 in small cans and thus

11 preventing owners from working on their own cars should be

12 removed from the discrete early action list because,

13 first, as I said before, the ban disproportionately

14 affects low income citizens. Ben is a California

15 resident, who earns 28,000 dollars a year. He keeps his

16 car air conditioning by adding 134a himself. He can buy a

17 can of refrigerant at Auto Zone for $10. If you impose a

18 ban on the sale of our R-134a, he must go to a garage or a

19 car dealer and pay $150 for the same of amount of

20 refrigerant or he must go without air conditioning and

21 just sweat it out during the summer.

22 Because it costs so much to go to the car dealer

23 or the garage, prohibiting do-it-yourselfers from adding

24 refrigerant cannot ever be cost-effective. The cost per

25 metric ton of CO2 equivalent avoided will range from 400

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345144

1 to $4,000, depending on whose numbers you use. This is

2 far greater than the 20 to $40 used in Europe to value

3 carbon credits offset.

4 Third, any global warming saving is minuscule.

5 The total amount of 134a refrigerant used by

6 do-it-yourselfers in the state of California is slightly

7 over one-half million metric tons of CO2 equivalent

8 annually. When the targeted of AB 32 goal is to save 147

9 million metric tons, how does it become significant to

10 warrant regulation when the total amount used, not saved,

11 is less than one-half of one percent of the total target?

12 It's also impossible to meet the one to two million

13 targeted goal since there is less than one million pounds

14 sold annually.

15 The ultimate solution will be to rereplace 134a

16 in all new vehicles with the new low GWP refrigerants

17 which are currently being tested and which will be

18 mandated in the European Commission. I won't go in that.

19 Our suggestion and alternative proposal to the

20 CARB staff --

21 CHAIRPERSON SAWYER: Would you please conclude.

22 MR. QUEST: Yeah. I'll just give you -- the

23 quick alternative proposal is, that we have a couple with

24 the leak checks, the alternative proposal is, after

25 January 1st, 2010, all cans of R-134a manufactured by the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345145

1 CARB -- for sale in the state of California used in motor

2 vehicle air conditioners shall be fitted with self-sealing

3 to prevent accidental release of R-134a. This will be

4 followed by a program to collect the cans after use and

5 recovering remaining on r-134a.

6 CHAIRPERSON SAWYER: Thank you very much.

7 And we certainly appreciate your industry working

8 with our staff to consider alternatives.

9 It seems to me the big problem in this area is

10 that the air conditioning systems leak. And I have a

11 vehicle like that. And my policy for a while was to take

12 it in when it started to get hot, get it recharged and, if

13 I was lucky, by the end of the summer, it was still

14 working. Then I'd do the same thing next year. I do not

15 do it myself, but it's the same problem, and it's not

16 getting the leaking fixed. My solution is to go without

17 the air conditioner right now.

18 But could staff or you say how one really

19 addresses the leaking air conditioner problems? That's

20 why the people are recharging their air conditioners, is

21 that there's a leak in it.

22 MR. QUEST: I can address a little bit or maybe

23 you all want to.

24 Our survey showed that three-fourths of the

25 do-it-yourselfers have only, they've either put one or two

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345146

1 cans into their vehicle over the life of the vehicle. So

2 it's not as though you have people that are putting a can

3 in this week, another can in next week, another can in the

4 next week.

5 Now, air conditioning start to leak. I mean, by

6 nature, the vibration causes air conditioners to leak.

7 There is a question that everyone has to make a decision

8 as to whether it's more feasible to put, to add

9 refrigerant or to have the service repaired or have it

10 repaired. And the repairs are made both by

11 do-it-yourselfers as well as the professional mechanic.

12 And we are selling, currently selling a number of leak

13 repair products, that are chemical products, that are used

14 when adding 134a.

15 CHAIRPERSON SAWYER: Dr. Ayala.

16 DR. AYALA: This is Alberto Ayala with the Air

17 Research Division.

18 We have an indication based on studies that we've

19 been following that mobile air conditioning systems are

20 becoming better and better in terms of controlling

21 unintended releases. Certainly the older the vehicle, the

22 less control they have. And we need to acknowledge that

23 the newer systems in newer vehicles are getting much

24 tighter.

25 So that is a factor that we need -- that we do

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345147

1 realize and we will consider closely. But the issue of

2 recurring recharging, leaking, recharging, is something

3 that we fully acknowledge in the brief staff analysis that

4 we included, both in the Climate Action Team report and

5 the AB 1493 discussions as well as in the early actions

6 report and it's something that we intend to look at very

7 closely.

8 It's instructive to consider that, for instance,

9 the state of Wisconsin does have a requirement that you

10 cannot recharge a system without fixing the leak. So

11 we're looking at those approaches in terms of how we can

12 implement those strategies in the our state. So we do

13 fully recognize that a continuing leaky system without

14 getting proper repair is going to be a concern.

15 But the can itself, it's a one-way system, once

16 you puncture the can, the greenhouse gas is bound the

17 enter the environment. And we fully acknowledge that the

18 alternative proposal that the industry has put on the

19 table does have a lot of merit.

20 CHAIRPERSON SAWYER: Thank you.

21 The next speaker now is Mr. Plotkin.

22 BOARD MEMBER CASE: And Mr. Chairman, while the

23 next speaker is coming up, relative to this same issue

24 about repairing the leak that's occurring or requiring

25 these cans, there was also written documentation from an

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345148

1 assembly member in my area, Juan Arambula, with a

2 suggestion we add money to the incentive programs to

3 change out some of these old vehicles. It would address

4 the Environmental Justice issues because these are older

5 vehicles, and it also brings in some of those areas

6 pollutants that we're trying to reduce that create ozone

7 and that might be another alternative to be looked at.

8 EXECUTIVE OFFICER WITHERSPOON: We're definitely

9 looking at that. And that's what takes legislation. And

10 we got letters from many members, and so perhaps one of

11 them would author the bill that added leak detection to

12 smog check, that added a subsidy repair for that specific

13 repair, it's not authorized right now. And that would be

14 the longer term solution for the old cars. But probably

15 in the meantime, we'll either go with the staff proposal

16 or with the industry alternative of the self-sealing

17 valves plus recycling. And we'll bring that part back to

18 you next fall. That's why we're not taking it off the

19 early action list entirely.

20 CHAIRPERSON SAWYER: Mr. Plotkin.

21 MR. PLOTKIN: Thank you, Dr. Sawyer, Honorable

22 Board members. Norman Plotkin representing the California

23 Automotive Wholesalers Association and the Automotive

24 Aftermarket Industry Association.

25 As you've heard, the industry is working with

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345149

1 CARB staff and we've worked with them for the last year

2 and appreciate their willingness to sit down and meet with

3 us on numerous occasions toward a real mitigation plan

4 that does not hurt the most vulnerable people in our

5 society. But industry's is not just the only voice you're

6 hearing now. We've been joined by a chorus and the

7 refrain is that if there are two mitigation plans, and one

8 hurts people and one does not, please choose the

9 mitigation plan that doesn't hurt people.

10 And Mr. Quest wasn't able to elaborate fully on

11 the alternative, but let me just reiterate that it's a

12 self-sealing can top coupled with a recycling program.

13 The recycling program gets to the residual amount left in

14 the can, that the concern is that it's then just discarded

15 and it openly vents.

16 We fully support the leak test as being part of

17 the biannual smog check and we will help you work on that.

18 That's the way to ensure that there's not this leak/refill

19 continuum.

20 But as we've attempted to gather support, in this

21 process, we've established point of sale displays in

22 retail automobile parts establishments and we've collected

23 thousands of letters is from individuals, people like

24 Valentine Herrera or Jesus Hernandez in Indio, Miguel

25 Venagas and Kate Berlin in Citrus Heights, Carol Souza

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345150

1 from Paradise. Yes, even in Paradise, you need air

2 conditioning. Monica Aguilar, Juan Costellanos from

3 Fresno. In addition, we've been able to get letters from

4 87 legislators supporting the notion that if there's an

5 alternative mitigation plan that doesn't have a negative

6 health and safety impact on the citizens of California,

7 please choose that mitigation plan.

8 And, finally, you've heard from the Environmental

9 Justice Advisory Committee who believe this, the can ban,

10 to be a regressive approach to climate control.

11 So, I just want to leave you with the prospect,

12 we've been responsible and we've come to the table and

13 we've worked diligently with your staff to propose an

14 alternative to the can ban. And it's real mitigation and

15 we want to roll up our sleeves and begin to develop this

16 recycling program. But, for the time being, when faced

17 with a ban of the product, we have to dedicate resources

18 to opposing that ban. Please let us work with you on the

19 recycling program, a real mitigation program that doesn't

20 hurt people.

21 Thank you.

22 CHAIRPERSON SAWYER: Thank you. Mr. Lowe.

23 MR. LOWE: Thank you, Mr. Chairman and members of

24 the Board.

25 I don't want to repeat what the last two speakers

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345151

1 have said. I just want to say, I'm with the Automotive

2 Aftermarket Industry Association. Again, my name is Aaron

3 Lowe.

4 We represent retailers and manufacturers of the

5 product. We're committed to educating consumers on the

6 proper use of the refrigerant and we really appreciate the

7 work with the Board staff on making that a reality. We're

8 also working closely with the Environmental Protection

9 Agency on this same action, so that we have a nationwide

10 impact.

11 I just want to say that establishing a recycling

12 program, unlike a can ban, would make sure that California

13 would actually have an imprint on a national program to

14 reduce unnecessary emissions of these -- well, 134a.

15 Unlike a can ban which would only effect the state of

16 California, we are working with the state to develop an

17 infrastructure which could have an impact on nationwide

18 sales -- a nationwide program.

19 So what we're asking for is that the can ban not

20 be part of this program and that we move forward with

21 staff to work on establishing the recycling program. And

22 that those reductions, we think, will be the same. We're

23 also, strongly support the smog check including a leak

24 check which will actually take care of both the

25 professional and the do-it-yourselfer, which, as you've

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345152

1 mentioned, is the big problem here.

2 So thank you very much and we hope the Board will

3 take that action.

4 CHAIRPERSON SAWYER: Thank you.

5 Ms. Oster.

6 MS. OSTER: Good afternoon, Dr. Sawyer and Board

7 members. My name is Rachel Oster and I'm here

8 representing Norcal Waste Systems and also the Solid Waste

9 Industry for Climate Solutions.

10 Like Director Leary, industry agrees that there

11 should landfill gas controls on methane emitting

12 landfills. However, I want to reiterate the fact that

13 only 40 out of the 200-plus methane emitting landfills in

14 California do not have currently have landfill gas control

15 systems in place. And actually, the 40 make up about 10

16 percent of the waste in place in California.

17 Most of the 40 landfills are too small to support

18 landfill gas control systems. When you put a system in

19 place in one of these landfills, it can put the aerobic

20 nature of the landfill at risk posing a threat to public

21 health and the environment. Therefore, we do uphold that

22 it is not technologically feasible for these controls to

23 be implemented on the small landfills that don't support

24 these systems.

25 Like Director Leary, we would like to encourage

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345153

1 staff to be sure of the effectiveness of these measures in

2 meeting the goals of early action, which is having it be

3 technologically feasible and cost-effective. And reducing

4 greenhouse gases.

5 Thank you.

6 CHAIRPERSON SAWYER: Thank you.

7 Mr. Wyman. And then we'll have Dominic DiMare,

8 Laura Hunter, and Patricia Monahan.

9 MR. WYMAN: Good afternoon, Dr. Sawyer, members

10 of the Board. My name is Bob Wyman. I'm an attorney at

11 Latham and Watkins in Los Angeles, and I'm here this

12 afternoon to speak on behalf of the California Climate

13 Coalition which is a coalition of electricity providers,

14 fuel providers, motor vehicle manufacturers, aerospace

15 companies, for about half the membership, and then the

16 other half of the membership are new clean energy

17 technology ventures.

18 In addition to considering discrete early action

19 measures as you are today, we believe that to meet the

20 short and long term objectives of AB 32, it will be

21 vitally important to consider structural changes,

22 structural approaches that can send an early and

23 significant signal to the market to stimulate new energy

24 and transportation technology investment. We're working

25 on a proposal which, while I'd very much hoped I could

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345154

1 have shared with you today, unfortunately, you'll have to

2 wait a couple weeks for it. But in a couple of weeks

3 we'll be able to share with you a proposal which we're

4 calling the California First Rapid Deployment Proposal,

5 which will be designed to stimulate rapid investment at a

6 large scale in new clean energy and transportation

7 technologies here in California and in the area serving

8 California's interests.

9 The idea is that by doing this, there will be a

10 way to get, not only the start this soon, but to gain

11 comfort with the market so when the Board is ready in 2012

12 to credit a market program, you'll do it within the

13 context of having first invested in California.

14 So I guess I'll just give you one kind of preview

15 of the concept. Which is an idea that would bring forward

16 a percentage of the emission caps as allowances that would

17 be distributed to new energy and transportation technology

18 investors. And we'll put this in some detail and share it

19 with you in the next week to two. I apologize for not

20 doing it today. We did our best, but as you've faced some

21 challenges so did we. And hopefully in a couple weeks

22 we'll have it out to you and other stakeholders who might

23 be interested.

24 Thanks very much.

25 CHAIRPERSON SAWYER: Thank you.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345155

1 Mr. DiMare.

2 MR. DIMARE: Good afternoon, Dr. Sawyer and Board

3 members. My name is Dominic DiMare. I am with California

4 Chamber of Commerce. I'm also here representing the AB 32

5 Implementation Group, yet another coalition of businesses

6 and industry here in California focusing on making sure

7 that implementation of AB 32 is done in an effective

8 manner that has the least negative effect on the economy

9 and the most positive effect on the recent greenhouse gas

10 emissions in California.

11 I, too, like many others would like to compliment

12 staff. They have been extremely helpful in this

13 undertaking which is, I don't know that people appreciate

14 how large an undertaking it is, to regulate greenhouse gas

15 emissions and meet the very ambitious goal of AB 32. And,

16 in fact, they've been so helpful that they recommended I

17 add the following statement which is: Never have I met a

18 more professional staff. In government.

19 So, but it's true. They've are, they've been

20 very, very helpful and they've been very open and

21 receptive to a lot of the suggestions that we've made.

22 Point number one that I'd like to make

23 is, the recognition of voluntary early emission

24 reductions, we believe, is a critical and essential part

25 to the overall regulatory framework. We know that there

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345156

1 are emissions reductions that can be had now, that don't

2 necessarily fall into the command and control structure or

3 the market structure that is being contemplated and will

4 be debated in the future, and that there are industries

5 and businesses that want to make those reductions now.

6 But also would like to ensure that there is some

7 recognition of those early actions on their behalf. And

8 so we support whatever -- well, we support the comments

9 made in the staff report about early actions and voluntary

10 early actions, and we endorse those and we will look

11 forward to working with staff to bring those to fruition.

12 The second issue is the economic analysis aspect

13 of this. I think that this is a unique opportunity for

14 the Board and staff, and for the state in general, with a

15 limited number, and I know you've received some criticism

16 about the limited number of proposals on the table today,

17 but it offers an opportunity for us to build a template or

18 a framework for economic analysis in the future that can

19 be applied to the more broad and numerous regulatory

20 proposals that will be coming down the pike in the future.

21 And we, to that end, have supported your budget

22 requests in the Legislature for more staff and we are

23 particularly interested in seeing some analysts on the

24 economic side being added to the ARB staff to complete

25 this task.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345157

1 And then, Low Carbon Fuel Standard. Like WSPA,

2 we have numerous concerns, and I will just echo what

3 Ms. Reheis-Boyd says. You know, a fuel standard must be

4 based on sound scientific foundation. And this is a very

5 dramatic change in how we do fuel policy here in

6 California. And going into the future we should ensure

7 that we have done all that we can in research to make sure

8 that it is a durable framework, as Dr. Sperling has said,

9 in the future.

10 In conclusion, we would just say that a lot of

11 uncertainty still surrounds climate change in the

12 regulatory proposals on the table today and in the future.

13 We would support enhanced budgetary allocations for the

14 ARB for enhanced economic and other research to make sure

15 that these are great and durable regulatory proposals that

16 will last and accomplish their economic goal, the economic

17 and environmental goals.

18 And so with that, I will conclude my remarks.

19 Thank you.

20 CHAIRPERSON SAWYER: Thank you very much.

21 Just a few words on our three-minute time limit.

22 When the red light comes on, if you could just say "in

23 conclusion," and then in a few seconds conclude. It saves

24 me the embarrassment of interrupting you.

25 Ms. Hunter.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345158

1 MS. HUNTER: Yes. Good morning. My name is

2 Laura Hunter and I'm with the San Diego Environmental

3 Health Coalition and I see you all have your red packet,

4 so that's good. I also serve as an alternate on the AB 32

5 Environmental Justice Advisory Committee, and as a member

6 of that Committee, we have a very keen interest in the

7 early action measures that you are discussing today. We

8 think they can provide a great promise to help alleviate

9 some of the worst sources of pollution in our

10 neighborhoods and they're part of sending that early and

11 significant signal that I think we need to send to the

12 state and the world, that our state is going to get

13 serious about addressing these issues.

14 The specific early actions I would like the speak

15 directly to are 27 and 28 on the have EJ Committee's list

16 related to the aging power plants, and that's a specific

17 area I want to talk a little bit more about.

18 These two actions recommend that you take early

19 action to phase out the aging power plants by 2010 and to

20 prohibit the fuel burning capacity by these facilities.

21 These aging power plants and their dual fuel capacity are

22 really ripe for a regulatory action from you to reduce the

23 greenhouse gas emissions that they contribute and to

24 improve community health.

25 Quick phase-out of these plans will yield big

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345159

1 benefits, especially if we replace them with lower

2 polluting energy generation. According to the CEC, aging

3 power plant emissions, and in this case, aging power

4 plants are defined as plants that were constructed prior

5 to 1980. So there is a section of -- a sector of them.

6 But they constitute 22 million tons of CO2 or six percent

7 of the state's global climate change emissions as a group.

8 In our case, in San Diego, the South Bay power

9 plant is one such facility that really needs to be phased

10 out quickly. The South Bay power plant has heat rates as

11 high as 12,000 BTUs, and in your packet you'll see a

12 comparison of that plant versus other types of energy.

13 And the downwind community suffering the impacts is 77

14 percent Latino, with 21 percent of the residents living

15 closest to plant live below the federal poverty level.

16 There -- we have had extenuous efforts to try to

17 get rid of this plant. Chula Vista Mayor Cheryl Cox and

18 Council Member Steve Castenada from Chula Vista have led

19 the effort to try to get rid of the plant, and the problem

20 is, even as we have added energy -- new energy generation

21 in the region, their RMR is not being removed from these

22 old plants, so we're very concerned that even though we're

23 bringing new generation on-line, we will keep these

24 things -- well, it's kind of a security blanket.

25 I'm going to bet my red light and I want to be

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345160

1 respectful of your time, but I want to stress that it will

2 be very important and it's very doable for you to say,

3 "Time is up for these old power plants, they've served us

4 well, but they're time is up." And I think that you

5 really can go a long way to moving us in this direction.

6 And to speak to Dr. Gong's comments earlier, I

7 think in the efforts of climate change, this is a place

8 where we need to make our own good news. So, hopefully,

9 we will have good news in short order, but we need to make

10 the good news in the future.

11 So thank you for your attention to this and I

12 hope you would support, especially 27, 28.

13 Thank you.

14 CHAIRPERSON SAWYER: Thank you very much.

15 Ms. Monahan. And then we'll have Virgil Welch,

16 Joseph Lyou, and Robina Suwol. And following Robina

17 Suwol, we will have our lunch break.

18 MS. MONAHAN: Thank you, Chairman Sawyer and

19 other members of the Board, CARB staff. I appreciate the

20 opportunity to testify in front of you today.

21 My name is Patricia Monahan, I'm the director of

22 the California Office, and I'd like to comment on two

23 areas. First, the Low Carbon Fuel Standard, and, second,

24 the heavy-duty vehicle efficiency measures.

25 UCS strongly supports the Low Carbon Fuel

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345161

1 Standard. It's groundbreaking policy that can help

2 protect against the entry into California's market of high

3 carbon fuels like liquid coal. Today, on the floor of the

4 U.S. Senate, they're debating the energy bill and there's

5 a lot of pressure to, from coal states to bring liquid

6 coal into California which can double the greenhouse gas

7 per gallon emission. So we want to make sure that doesn't

8 happen.

9 That said, we urge the Board to direct the staff

10 to include appropriate safeguards for air quality and

11 environmental protection. We're concerned that without

12 appropriate environmental safeguards, we could see a loss

13 of bio diversity. We could see water scarcity. We could

14 see land conversions. And we could also see a dramatic

15 increase in food prices. So we think this is an

16 opportunity for the Board to direct the staff to go beyond

17 what the Governor has called for and to really look at the

18 sustainable development of transportation fuels.

19 In addition, we ask that the Board direct the

20 staff to ensure that there's no harmful impacts on air

21 quality, which there can be from certain transportation

22 fuels.

23 The second issue I want to discuss is the

24 heavy-duty vehicle efficiency measures. We're glad that

25 they're part of the Group Two. We're glad to see that

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345162

1 CARB is going to consider in the development of the air

2 quality regulation, a concern for global warming

3 pollution. But we want to make sure that this really

4 happens in a directed way.

5 We would like the Board to direct the staff to

6 elevate these to Group One measures. We think that there

7 is significant data available right now, the Smart Way

8 program by the U.S. EPA has evaluated various technologies

9 such as aerodynamic improvements, like size skirts on

10 heavy-duty trucks. Single-wide tires, automated tire

11 inflation and low viscosity lubricants that can, together,

12 reduce global warming pollution by ten percent.

13 These improvements will reduce fuel consumption

14 and save truckers money. Improving the overall

15 cost-effectiveness of the rule. We call these win-win-win

16 strategies. It's a win for the trucker, it's a win for

17 the public, and it's a win for CARB as it tries to

18 implement the mandates under AB 32.

19 Again, we thank you for this opportunity. We

20 look forward to working with the dedicated CARB staff on

21 the development of these regulations.

22 CHAIRPERSON SAWYER: Thank you very much.

23 Mr. Welch.

24 MR. WELCH: Thank you, Mr. Chairman and members.

25 My name is Virgil Welch, I'm an attorney with the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345163

1 Environmental Defense in Sacramento.

2 I'd like to just start by recognizing the effort

3 that both the Board and the staff have put into this

4 process, not just in terms of early action, but also in

5 terms of AB 32 implementation, in general. And if we are,

6 in fact, going to reach the goals that we've set out in

7 AB 32, this kind of effort, this kind of education is

8 going to have to continue, which we believe it will. So

9 thank you very much for that.

10 Environmental Defense has submitted fairly

11 detailed comments to both the Climate Action Team and to

12 this Board. So rather than go over again what those

13 detailed comments are, I would just like to highlight a

14 couple of basic point which we would like you to consider

15 today and as we move ahead in future.

16 The first is that we do, Environmental Defense,

17 support the three tier one recommendations for inclusion

18 as early action measures, particularly the Low Carbon Fuel

19 Standard.

20 And the second is an issue that's been brought up

21 a fair amount this morning already. And that is we

22 believe it's quite important to recognize and reward

23 voluntary early action. Because of the magnitude of the

24 challenge we face in terms of global warming, we need

25 action, we need it now, and recognizing early actions is

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345164

1 the key way to do that.

2 The third point that I would like to raise is

3 that there are some items on tier two, and perhaps even

4 tier three, that we would urge this Board consider to move

5 up to tier one. This previous speaker mentioned one of

6 those. I would just highlight that those that have

7 co-benefits in terms of air quality, things like port

8 electrification or truck stop electrification, we believe

9 should be considered. And if not moved into tier one, we

10 believe that those items that now are sort of tier two or

11 tier three, we would like the see more definitive time

12 frames, milestones, connected to those so that as we move

13 through this process we do have a better understanding

14 about just when we are going to achieve those types of

15 reductions. Based on some of the comments this morning

16 from the staff, I believe we're well on our way in that

17 regard.

18 So again, thank you for your efforts here and we

19 look forward to working with you throughout the process.

20 CHAIRPERSON SAWYER: Thank you. Thank you very

21 much.

22 Dr. Lyou.

23 DR. LYOU: Yes, thank you. I was not quite sure

24 when I went.

25 Chairman Sawyer, members of the Board, my name is

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345165

1 Joe Lyou, I'm the Executive Director of the California

2 Environmental Rights Alliance. Thank you for allowing me

3 to address you here today.

4 I'd like to voice my support of the Environmental

5 Justice recommendations that you heard today and give you

6 the caveat, of course, that Angela Johnson-Meszaros is my

7 colleague and we work for the same organization. So I

8 like the praise that you give her, if you give her too

9 much, we have to pay her more, so keep it to a minimum.

10 I'm really here to talk about one measure in

11 particular and that's the ground service equipment at the

12 airports. I've been a member of coalition that negotiated

13 community benefits agreement with Los Angeles World

14 Airports a few years ago, and we have successfully

15 negotiated into that agreement bringing all the tenants at

16 LAX up to the MOU standard. And that was before the MOU

17 was basically dismantled by the exiting of certain

18 airlines.

19 The construction and off-road equipment

20 regulation that you're considering does not require

21 electrification of the ground service equipment that was

22 required by the MOU. And it was very disappointing during

23 the regulatory process that staff would not incorporate

24 that into the regulation. And they, I mean, fairly, I

25 mean, to them, said there are higher priorities that get

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345166

1 them more diesel emission reductions through other

2 measures of the off-road rule.

3 But you can and should require electrification of

4 ground service equipment. There are imitations on what

5 you can do, but your staff has a good idea of what those

6 limitations are. To allow the airlines to voluntarily,

7 over time add electrical equipment to the ground service

8 equipment is not going to guarantee you any of those

9 benefits. Neither the diesel emission benefits nor the

10 greenhouse gas emissions benefits. So I'd like you to

11 focus on that.

12 Secondly, gate electrification is another option

13 at airports, as at least one of your members knows for

14 sure. And that, you know, we also negotiated the use of

15 the best available control technology on construction

16 equipment during the modernization of LAX. And that has

17 proved to be a very effective part of our agreement in

18 terms of reducing diesel emissions and greenhouse gas

19 emissions.

20 So please focus on those things that can and

21 should be done in the near term, including the ground

22 service equipment electrification, the gate

23 electrification, and doing more of that construction rule

24 with regards to diesel filter traps and electrifying the

25 urban construction equipment.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345167

1 Thank you.

2 CHAIRPERSON SAWYER: Thank you very much.

3 Ms. Suwol. And then we will take one additional

4 speaker before the lunch break, Cynthia Babich.

5 MS. SUWOL: Thank you so much. Thank you,

6 Chairman Sawyer and Honorable Board.

7 My name is Robina Suwol, I'm the Executive

8 Director of California SAFE Schools, a children's

9 environmental health organization.

10 And I'm testifying today to request that the

11 Board do something now to stop this international crisis.

12 It's especially impacting the health of our most

13 vulnerable, our children. And environmental justice

14 communities.

15 I know that earlier in the hearing one of the

16 honorable Board members said that we need some good news.

17 And there is good news. You have a number of action

18 measures that have been provided to you that will reduce

19 greenhouse gases and criteria pollutants. And the

20 greatest news, actually, of all is that the ability to do

21 so is in your hands. So please prioritize these measures

22 for early actions. We can't wait for the magic of the

23 market.

24 So thank you so very much for your time and for

25 working cooperatively with the Environmental Justice

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345168

1 Committee.

2 Thank you.

3 CHAIRPERSON SAWYER: Thank you.

4 Cynthia Babich.

5 MS. BABICH: Thank you so much fitting me in

6 before lunch. I am Cynthia Babich and I'm the Director of

7 the Del Amo Action Committee. We're a grassroots

8 environmental justice community, and as such, I have

9 responsibilities this afternoon as a caregiver for my

10 mother, so I appreciate you fitting me in because I won't

11 be here this afternoon.

12 I just really want to say that this is a very

13 important issue. You have a number of our colleagues in

14 the Environmental Justice Advisory Committee who don't

15 necessarily have the resources at the disposal of some of

16 the agencies who seem to have staff constraints, which I

17 find it a little bit irritating because most of us have to

18 do fundraisers, and for us to tell a funder that we're

19 going to put a 12-month buffer on something just simply

20 wouldn't do. So as a community who has two Superfund

21 sites, we have several Brownfield sites. We have the

22 Exxon-Mobil refinery which is continually being fined. We

23 have pure benzene floating on our ground water. We are a

24 community that's very much impacted. And the ARB in step

25 with its mission to protect public health and in

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345169

1 collaboration and culmination with the measures to reduce

2 global warming, needs to do more than that's proposed to

3 them by early action measures.

4 Our communities already suffer disproportionately

5 from air toxics from the refineries, ports, cement, and

6 energy producing industries who can do much more now to

7 lower its greenhouse emissions, thus reducing the burdens

8 on the lungs of our already compromised children.

9 We are in strong support of the recommendations

10 for more measures to be added to the action list as

11 outlined by the AB 32 formed Environmental Justice

12 Advisory Group on global warming. Please listen to their

13 recommendations carefully and implement their additions.

14 We support real reductions now, not later.

15 Many of the members that you have in front of you

16 that represent our communities and do have a seat at the

17 table have just a wide range of expertise. And we really

18 deal with no-nonsense real things that we can do today

19 because certainly if our representatives were to put

20 something forward that was unreasonable, it would not fly

21 with our communities first. So, as you see them before

22 you, remember there's a long list of people like me who

23 just are trying to get along in our little communities and

24 just make things a little bit better and take care of our

25 parents and our own business, that you have us behind

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345170

1 them.

2 So good luck today and this afternoon. I have a

3 lot of faith in this system, obviously. I'm still trying

4 to come to the table. And that you'll do the right thing.

5 Thank you so much, again, for allowing me to

6 sneak in before your lunch.

7 CHAIRPERSON SAWYER: Thank you very much.

8 At this time, we will take a lunch break. And we

9 will start at 2:00 o'clock this afternoon in recognition

10 that some of you have to eat at local restaurants, in

11 order to get back. I think that will give us time.

12 Thank you.

13 (Thereupon, a lunch recess was taken.)

14 CHAIRPERSON SAWYER: The Air Resources Board has

15 now reconvened, and we'll continue with the public

16 testimony on the early actions to mitigate climate change.

17 The first three speakers are Joe Gershen, Larry

18 Allen, and Darrell Clarke.

19 MR. GERSHEN: Thank you for the opportunity. I'm

20 Joe Gershen, I'm representing Environmental Entrepreneurs

21 also known as E2.

22 Environmental Entrepreneurs is a national

23 community of business professionals that support a clean

24 energy policies that are good for the environment and good

25 for the economy. We have over 500 business leaders in

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345171

1 California that participate this this effort. E2 strongly

2 supports CARB adoption of the Low Carbon Fuel Standard as

3 an early action measure which CARB estimates will provide

4 ten to 20 million metric tons of carbon dioxide equivalent

5 reductions by 2020.

6 The renewable fuel industry in California is

7 looking for a clear signal there will be regulatory

8 certainties supporting the creation of a low carbon fuel

9 market, prompt adoption of the Low Carbon Fuel Standard

10 will send that signal.

11 Supporting this industry will help create jobs,

12 stimulate innovation and investment, encourage competition

13 and create fuel diversity to name only a few of the

14 economic benefits. Petroleum prices are at near-record

15 levels and are likely to continue climbing.

16 California's low carbon commitment is critical,

17 not only to achieving the state's greenhouse gas reduction

18 targets, but also to protecting California consumers from

19 financial risk. We are aware of some controversy

20 surrounding biofuels industry and I am here to tell you

21 that we can move forward responsibly, sustainably, and

22 without backsliding on air quality. Many biofuel

23 companies have developed as a result of a strong

24 environmental ethic. There are many feedstock options

25 being developed for biodiesel and ethanol. Algae, mustard

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345172

1 seed and totropha, to name a few, can be used for

2 biodiesel instead of soy and canola and cellusocic

3 technologies will offer staggering ethanol yields from

4 recycled biomass as compared to corn.

5 We are in the midst of a paradigm shift away from

6 traditional carbon fuels and toward low carbon renewable

7 energy. My company, Tularian Biodiesel, has a commitment

8 to sustainability. Our model is to use local and

9 domestically available feedstock for regional biodiesel

10 production and consumption whenever possible in order to

11 maximize carbon reduction and energy conservation. Our

12 feedstock of choice is recycled cooking oil and other

13 second use fats and oil.

14 In addition to this, we are managing an

15 innovative demonstration project funded by South Coast

16 AQMD that CARB is participating in along with the National

17 Renewable Energy Lab, California Energy Commission, and

18 City of Santa Monica. We have been testing biodiesel with

19 SCR technology to reduce NOx emissions and have been

20 getting spectacular results. Our final report should be

21 published later this summer.

22 Our regional business development strategy is an

23 integral part of a broader philosophy of sustainability.

24 Developing community, municipal, and regional business,

25 agriculture, and infrastructure to support the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345173

1 implementation of low carbon fuels will provide jobs, tax

2 revenues, good environmental public policy. It will also

3 promote the use of renewable low emission fuels reducing

4 air pollution while helping to establish a sustainable

5 energy future.

6 The Low Carbon Fuel Standards will give the

7 agricultural, energy, and auto industries incentives now

8 to start lowering the carbon intensity of today's fuels

9 and to begin developing the next generation of truly low

10 carbon fuels and vehicles. This will for the first time

11 create a viable alternative to petroleum.

12 Thank you.

13 CHAIRPERSON SAWYER: Thank you.

14 Mr. Allen.

15 MR. ALLEN: I'm Larry Allen, I'm the Air

16 Pollution Control Officer for San Luis Obispo County and

17 the current President of the California Air Pollution

18 Control Officers Association. CAPCOA strongly supports

19 the three Group One measures that are proposed by staff as

20 appropriate for adoption and implementation within the

21 specified time frames. In our May 14th letter to staff,

22 we also recommended that ARB consider moving some of the

23 Group Two measures onto the Group One list. In

24 particular, we believe that the substantial reduction

25 potential in the commercial refrigeration and heavy-duty

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345174

1 vehicle categories warrants consideration in the Group One

2 status.

3 As mentioned by Supervisor Hill this morning, our

4 letter also recommended five additional early action

5 measures that are not included in the staff proposal. We

6 believe those measures can be accomplished within AB 32

7 time frames and that they meet the primary screening

8 criteria.

9 The first recommendation is to prioritize SIP

10 rulemaking based on criteria pollutant productions, public

11 health protection, and greenhouse gas reduction potential,

12 and that rules that rank high in all three areas should be

13 given higher priority in the rulemaking calendar.

14 Second, to perform a review of existing state and

15 local similar to an all feasible measures review to

16 identity existing regulations that can or already provide

17 significant reductions in greenhouse gases. For example,

18 existing inspection of maintenance rules for petroleum

19 processing and transport facilities can achieve up to 80

20 percent reduction in fugitive hydrocarbon emissions by

21 requiring regular testing and inspection of valves and

22 flanges to detect and repair leaks. However, those regs

23 are designed specifically to reduce volatile organic

24 compounds as ozone precursors and so that natural gas

25 processing facilities are exempt from those regulations

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345175

1 because methane is not identified as an precursor would be

2 very easy to adapt existing I and M to those facilities.

3 And the resulting methane reductions could be significant.

4 Third recommendation is to minimize the impacts

5 of new stationary sources by working with districts to

6 develop a coordinated approach reviewing greenhouse gas

7 emissions from significant stationary sources. And a good

8 example is that an ethanol plant in northern Santa Barbara

9 County, that would produce 113 million gallons of ethanol

10 with 1.2 million tons per year of corn, and it would

11 result in 550,000 tons of carbon dioxide. Now they

12 originally proposed to include a carbon dioxide capture

13 and liquefaction facility, but that was taken out of the

14 design because there's no market. So we need some

15 guidance on how to handle greenhouse gas emissions from

16 those sources.

17 Fourth recommendation is to leverage CEQA

18 mitigations by working with local districts to coordinate

19 how we review greenhouse gases under CEQA and capture the

20 reductions that result from that mitigation.

21 And the fifth one is for the Air Resources Board

22 to work with local districts to establish mechanisms to

23 promote and track voluntary greenhouse gas reductions.

24 In conclusion, CAPCOA believes that these

25 measures can be easily implemented to achieve significant

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345176

1 early greenhouse gas reductions. Although we've yet to be

2 asked for our input and have been told that we don't have

3 a role to play in AB 32 implementation, we do believe that

4 the extensive on-the-ground expertise and resources of the

5 air districts is a valuable and essential assets that can

6 be used by the state to ensure successful implementation

7 of this program. And we do stand ready to help in that.

8 CHAIRPERSON SAWYER: Thank you very much.

9 BOARD MEMBER D'ADAMO: Mr. Chairman.

10 Go ahead, sorry, I didn't realize you had been

11 called on. I'll wait.

12 CHAIRPERSON SAWYER: Mrs. Riordan.

13 BOARD MEMBER RIORDAN: Just a quick comment. You

14 certainly are going to be partners with us in the long

15 haul for implementation. And I'm sure that we will seek a

16 lot of input from you. This is a very helpful document.

17 And I think we have some real interest, particularly in

18 your last recommendation, or at least I do, for looking at

19 those voluntary reductions. Because I think people are

20 interested in doing things, both as an industry but also

21 as individuals, and they are going to look to the local

22 air districts for guidance. They're not necessarily going

23 the call Sacramento every time they want to know

24 something. They're going the call their local districts.

25 So I think you're a real integral part of this whole

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345177

1 program.

2 And I would ask the staff if they have any

3 comments on the other recommendations. I just feel pretty

4 strongly about the last one that I think is something we

5 really have to seize the opportunity there. But there may

6 be some staff responses that you'd like to make,

7 Ms. Witherspoon, or any other staff member.

8 EXECUTIVE OFFICER WITHERSPOON: I'll just run

9 through them quickly.

10 On the prioritization of SIP rulemaking, we agree

11 and we think you'll see tomorrow that we've already done

12 that, and our goods movement action plan, likewise, where

13 there are co-benefits for greenhouse gas reduction.

14 On the review of the exiting rules, we hadn't the

15 thought of doing this on the stationary source rules, but

16 as I indicated earlier, the Bay Area District was first

17 out the shoot with a top to bottom analysis of their

18 rules. And how they could go back and capture more

19 greenhouse gas reductions. And so we'll certainly consult

20 with them first and look at ways of generalizing some of

21 their discoveries.

22 On minimizing the impacts of new stationary

23 sources, we had been asked early in the process to develop

24 BACT guidelines for greenhouse gas control and decided

25 that was way beyond our capabilities because we were doing

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345178

1 sector specific analyses on what individual facilities

2 could bear and needed to get that done as part of the

3 scoping plan. And it's not so easy, not so clear what

4 BACT is for the lowest possible CO2 and other gas

5 emissions.

6 And I think that we need to spend some time

7 talking through the options with CAPCOA.

8 On CEQA mitigations, I spoke earlier about the

9 principle problem that there's no threshold of

10 significance that triggers CEQA. The South Coast AQMD

11 intends to define one for its own purposes, and in the

12 absence of state guidance, it's on the shoulders of the

13 lead agency to make the call. And so they're going to

14 propose one and we've already talked to the South Coast

15 about when they have their theory together of working

16 closely and seeing if it makes sense for a statewide

17 threshold.

18 And then on capturing voluntary reductions,

19 that's exactly why we're working so hard on protocols.

20 And what I get out of this recommendation is also the

21 tracking notion, so that once we've incented local

22 governments to do good things, we capture the success of

23 that and how many tons are being amassed around the state

24 and can take credit for it in our overall reduction plan.

25 And any help we could get from districts in compiling that

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345179

1 information would be enormously helpful.

2 BOARD MEMBER RIORDAN: Thank you.

3 CHAIRPERSON SAWYER: Ms. D'Adamo.

4 BOARD MEMBER D'ADAMO: That was my question.

5 Thank you.

6 CHAIRPERSON SAWYER: Okay. Good.

7 MR. ALLEN: If I could make one more point

8 related to that, and that is that we are already involved.

9 We have local jurisdictions asking us how to do climate

10 change analysis, what the significance thresholds are.

11 And we have to come up with something and our Climate

12 Protection Committee is working on that right now. It

13 would be far better to have state input helping us with

14 that so we're consistent.

15 And the same with new source review. The state

16 attorney general just wrote a letter on a refinery permit

17 at the Bay Area asking about the greenhouse gas emissions

18 for that modification. They are going to have to deal

19 with that through CEQA.

20 So these are, I think, large issues for us to be

21 working with. And in the absence of guidance, we're out

22 there on our own.

23 EXECUTIVE OFFICER WITHERSPOON: We agree, they're

24 huge issues. And we have been meeting regularly with the

25 Office of Planning and Research and the Department of

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345180

1 Resources which has lead in state government for giving

2 CEQA guidance. And, although there has been a great deal

3 of conversation, there has not yet emerged a compelling

4 theory that everyone can agree with, this is what the

5 definition of "significant" should be. The attorney

6 general has entered the field, has brought suit, but it

7 also has not articulated a theory of significance. And so

8 conversations have now been brought in to include the

9 attorney general in the state level conversation.

10 And in the meantime, as unfortunate as it is,

11 local lead agencies have to exercise their own judgment

12 and decide what to do until the legal pathway is clear.

13 CHAIRPERSON SAWYER: Thank you very much.

14 Mr. Clarke. And then we will have Bob Lucas,

15 Kathy Seal, and Julia Maher.

16 MR. CLARKE: Thank you very much. I'm Darrell

17 Clarke representing the Sierra Club. I'm a member of the

18 Angeles Chapter's Executive Committee representing 50,000

19 members in Los Angeles and Orange County.

20 These early action measures are very important,

21 but I would encourage you to adopt more than just three,

22 to moves others up from the chart two, chart three, and

23 perhaps a way to consider the urgency here: Pearl Harbor

24 has just been attacked. What is our mobilization plan

25 now? In global warming terms, we've got ten years to make

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345181

1 a big difference. What is our mobilization plan now?

2 I'd like to mention three points. Thank you,

3 Dr. Sperling, concerning the considerations on the Low

4 Carbon Fuel Standard and helping me understand that

5 better. A lot of us talk about serious concerns about

6 corn ethanol, the taking as much fossil fuel to produce it

7 as you get out the other end, or biodiesel, if it comes

8 from clearing rain forest to plant palm oil plantations is

9 providing us no benefit at all on CO2 emissions.

10 On the other hand, electric vehicles offer a lot

11 of promise with plug-in hybrids and electric vehicles, and

12 it leads me to a question of this Board. On the one hand,

13 there's the -- what was the zero emission vehicle mandate,

14 which I understand is being reassessed this year, and then

15 there's the AB 32 mandate. These can come together around

16 this very important mid-term program towards electric

17 vehicles that can use sustainably generated electricity.

18 And I'm not sure how we bring those two halves together

19 under the ARB. But it seems a great opportunity this

20 year.

21 Second, there's a big elephant in the room that

22 I'm not sure who has jurisdiction for. But you as the

23 lead agency. There are approximately 9,000 megawatts of

24 new fossil fueled electricity power in the planning

25 process in California. Who has jurisdiction over the

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1 greenhouse gas emissions that those would produce?

2 And number three, about it of good news for

3 Dr. Gong, that over 90 California cities have signed on to

4 the Governor's Climate Protection Agreement, what the

5 Sierra Club calls "Cool Cities," which provides great

6 opportunity. Once these cities have signed on, what can

7 the ARB or other state agencies do to help these cities

8 get into their planning of the next steps to reduce the

9 greenhouse gas emissions?

10 So thank you very much. I look forward to much

11 progress going forward.

12 CHAIRPERSON SAWYER: Thank you.

13 Mr. Lucas.

14 MR. LUCAS: Thank you. Good afternoon. My name

15 is Bob Lucas. I'm here today representing the California

16 Council for Environmental Balance, otherwise known as

17 CCEEB. And we do support the staff recommended action for

18 you today to implement this portion of AB 32.

19 That said, I would like to echo some of the

20 cautionary statements that were made earlier in the day

21 with regard to being prudent and somewhat cautious in

22 order to be sure that we get this right.

23 As referring back to the comments we submitted on

24 May 17th, you see that we do have some concerns with

25 regard to cost-effectiveness and technological feasibility

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1 and some of the proposals before you today. And we would

2 concur that these are very important points to rationalize

3 and we'd suggest that a first order of business as the

4 staff beginning the rulemaking process, is to adopt

5 criteria that would demonstrate what cost-effectiveness

6 and technological feasibility actually means. In however

7 broad or narrow we want to look at it, we think that we

8 ought to establish that criteria sooner rather than later.

9 In the absence of it, frankly, we run the risk of adopting

10 regulations that might cause leakage.

11 With regard to voluntary early action, we think

12 that this is another very important point and we, frankly,

13 were pleased to see the staff report dealing with this and

14 recognizing this point. We're encouraged that they're

15 looking for -- they understand a need for a programmatic

16 element to quantify and document sector specific and

17 project specific protocols for voluntary early actions.

18 Until this is determined, we'd like to suggest a

19 slightly different approach. And this would be a process

20 that would allow early consideration by CARB on a

21 case-by-case basis of a wide array of projects that

22 companies might want to voluntarily undertake. And we

23 suggest this as an encouragement for companies to take

24 voluntary early actions and to provide opportunities for

25 CARB and stakeholders to learn from these projects prior

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345184

1 to the formalities of a final rules stages. In other

2 words, try to accelerate that if we can.

3 Our concluding comment is that we believe that

4 it's important to consider AB 32 as a bridge to future

5 regional, national, and international programs. And to do

6 that, we think that it's -- and for that reason, we think

7 that the actions taken to implement the program need to

8 address issues in a manner that prevents leakage through

9 cost-effective and technologically feasible implementation

10 requirements as well as through a robust market, an offset

11 program that's attractive to functional entities in

12 California, other states, and in the nation.

13 Frankly, CCEEB believes that a market program

14 will do a better job at finding the most cost-effective

15 and technologically feasible way of accommodating or

16 accomplishing greenhouse gas emission reductions than

17 through extended rulemaking. And as potential rules are

18 considered through Groups two or three, we would hope

19 you'd take this into consideration and consider the

20 functionality of these rules, or how these rules might

21 affect the functionality of the program.

22 Thank you very much.

23 CHAIRPERSON SAWYER: Thank you.

24 Ms. Seal.

25 MS. SEAL: Hello, my name is Kathy Seal, I'm with

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1 Friends 4 A Livable Planet. We're a local grassroots

2 group of ordinary people who just want to do something

3 about global warming.

4 As summarized here this morning, the IPCC report

5 is truly alarming. Yet, and I say this with all due

6 respect to the hard work and good faith of the staff, the

7 three recommendations for today are puny. I know these

8 issues are complex and I know they're difficult. But

9 we're facing catastrophe. Just to cite one statistic, the

10 Sierra snowpack may drop by at least 29 percent in the

11 next few years. And as much as 70 percent. What does

12 that mean for water in Southern California? That means

13 really economic catastrophe for farms, for drinking water

14 for everyone.

15 So my message to you today is please do more and

16 do it immediately. Our future is in your hands.

17 One thing you might do is reinstate as the

18 previous speaker mentioned, the zero emission vehicle

19 requirement mandate for electric cars and plug-in hybrids,

20 which is in your purview.

21 You must do more and do it now and do this for

22 our children and for our grandchildren and their children.

23 This is urgent. Please, move up more actions into the

24 list of immediate early actions today.

25 Thank you.

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1 CHAIRPERSON SAWYER: Thank you.

2 Ms. Maher.

3 The next three speaks are Martha Arguello, Mitzi

4 Shpak, and John Andrew.

5 Ms Arguello.

6 MS. ARGUELLO: Good afternoon. My name is Martha

7 Adena Arguello and I am the Director of Health and

8 Environment Programs with Physicians for Social

9 Responsibility and also a member of the Environmental

10 Justice Advisory Committee.

11 So what we saw today in the research project is

12 that the time for half measures has passed. Existing

13 market-based measures seem to be failing to deliver on the

14 promise of reductions in carbon emissions or in any other

15 air pollutants. The impacts of climate change will be

16 felt most strongly in low income communities of color

17 throughout California and the world. As a committee, we

18 are committed to ensuring that our policies do not do the

19 same to these communities.

20 The early action measures that we adopt in

21 California must be more diverse and robust than the three

22 that have been presented by staff. We look forward to

23 working with you and the staff, the Board and the staff,

24 to come up with truly robust and effective early action

25 measures that get us where we need to be.

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1 Also, we must not forget that command and control

2 measures work and we need to be braver in pushing more of

3 those kinds of measures. At the end of the day,

4 market-based mechanisms are designed to reduce the cost of

5 compliance, which is not the same thing as reducing

6 emissions.

7 Thank you.

8 CHAIRPERSON SAWYER: Thank you.

9 Ms. Shpak. And then we will have -- excuse me.

10 Then we will have John Andrew, Jane Williams and Roland

11 Hwang.

12 MS. SHPAK: Dr. Sawyer, the Board, my name is

13 Mitzi Shpak. I'm with Action Now, I'm Executive Director.

14 It's a small community-based environmental justice

15 organization in Los Angeles. I'm also a biotechnologist

16 on staff at Cal Tech.

17 I'm here to encourage this Board to adopt the

18 early action measures as recommended by the Global Warming

19 Environmental Justice Committee. The Committee's

20 recommendations include several technically and

21 sociologically feasible measures that would have

22 meaningful effects in a relatively rapid time frame. The

23 effects of climate change are real. To counter these

24 effects, we need the adopt practices that are truly

25 effective and yield meaningful results.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345188

1 Climate change is not a game or an administrative

2 exercise. Climate change has real measurable effects on

3 the planet and to prevent the most damaging of these we

4 need to take action now. The Global Warming Environmental

5 Justice Committee recommendations we believe to be the

6 best options for early actions.

7 And on a side note, because cost-effectiveness

8 came up so many times, I'd like to remind the Committee

9 that there is no cap on the cost of global warming. Its

10 potential costs dwarf any short term costs of making what

11 are common sense changes to ensure our survival.

12 Thank you.

13 CHAIRPERSON SAWYER: Thank you.

14 Mr. Andrew.

15 MR. ANDREW: Good afternoon, Mr. Chair and Board

16 members. I'm John Andrew, I'm the Executive Manager for

17 Climate Change at the Department of Water Resources.

18 As a sister or a brother agency of the ARB and

19 the Governor's Climate Action Team, it's my pleasure to

20 submit a letter from our director, Lester Snow, in support

21 of these proceedings today. And I'd like to quickly

22 summarize that letter at this time.

23 As you know, in addition to early actions, AB 32

24 requires state agencies to reduce their greenhouse gas

25 emissions and I'm happy to report the DWR is already on

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345189

1 its way to doing so. For example, we have joined the

2 California Climate Action Registry, and as part of that

3 process, are calculating our carbon footprint for the

4 department and, specifically, the state water project. We

5 are evaluating the power portfolio for the state water

6 project, in particular; 60 percent of which is already

7 from clean hydroelectricity.

8 That being said, there is a small portion of that

9 power portfolio that is derived from coal from a plant in

10 Nevada. But I'm happy to say that we have decided as part

11 of our process in looking at the power portfolio, that we

12 will not review our contract for that power when it

13 expires in 2013.

14 And also as part of the process of looking at our

15 power portfolio, we are voluntarily developing a renewable

16 portfolio standard for the state water project.

17 Beyond the Department of Water Resources, we are

18 also looking to the rest of the California water

19 management community and we plan to accelerate our

20 investments in water use efficiency and target those

21 investments to those measures that also have co-benefits

22 with energy efficiency and thereby reduce greenhouse gas

23 emissions. Further, we are already working with local

24 agencies through our grant making through Proposition 50

25 and Proposition 84 to help incorporate climate change

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345190

1 considerations at the local and regional planning levels.

2 We appreciate the leadership demonstrated by CARB

3 this issue and look forward to continuing to work with

4 both you and the other members of the Governor's Climate

5 Action Team as we combat climate change in California.

6 Thank you for the opportunity to comment today.

7 CHAIRPERSON SAWYER: Thank you.

8 Ms. Williams.

9 MS. WILLIAMS: Thank you, Chairman Sawyer,

10 members of the Board. I'm Jane Williams, I am also the

11 other co-chair of the Environmental Justice Advisory

12 Committee. I spoke to some of you on the phone. Thank

13 you so much, Board members, for taking time to meet with

14 myself and some of the Committee members.

15 A number of issues I want to cover very quickly.

16 One, I wanted to bring to your attention that there has

17 been a letter, hopefully, it's in your packet from

18 environmental justice organizations, actually, across the

19 country who are looking to California to show leadership

20 on taking actions today to get us on the road to doing

21 things that we can do now to get real reductions here in

22 California. These organizations are looking at the

23 environmental justice movement in California and this

24 Board's actions as a litmus test on what kind of political

25 will exists to take actions and not wait for the magic of

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345191

1 the market or the magic of some sort of action that's

2 going to happen a long time in the future.

3 A couple other things I wanted the mention. One,

4 on the Low Carbon Fuel Standard. As you know, the

5 Environmental Justice Advisory Committee was very

6 concerned about the ethanol path, the corn ethanol path in

7 the Low Carbon Fuel Standard, because of backsliding on

8 existing area quality standards and on food security

9 issues, quite frankly. So I'm wondering if this Board,

10 and, again, I want to reiterate that we didn't say that a

11 Low Carbon Fuel Standard wasn't a good idea. We were very

12 concerned about the current path of Low Carbon Fuel

13 Standard, which is an ethanol path. There's a hundred

14 ethanol plants being constructed right now across this

15 country. There are tremendous incentives and subsidies in

16 the 2005 energy bill. There is a political juggernaut for

17 corn-based ethanol in this country.

18 And so I'm wondering if the Board might like to

19 take this opportunity, before your staff marches down a

20 regulatory path on the Low Carbon Fuel Standard, to give

21 them some direction on what they think that standard

22 should look like. Should it be a standard that includes

23 and embraces corn-based ethanol, which we feel, the

24 Environmental Justice Advisory Committee, is not going to

25 be the compliance with the underpinnings, the statutory

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345192

1 underpinnings, especially against backsliding and

2 disproportionate impact that are in the bill. So I just

3 want to call that to your attention and see if you might

4 be interested in giving your staff some direction. So

5 that we're not back here in two or three years with a Low

6 Carbon Fuel Standard that is not going to meet the

7 requirements of the law and also is going to be very, very

8 politically controversial.

9 The last thing I wanted to bring to your

10 attention is that, I'm sure many of you know what's going

11 on in Darfur. There's 200,000 people that have died in

12 Darfur in the last two years. That is a climate change

13 catastrophe. The problems in Darfur are absolutely,

14 positively caused from drought, that is caused from global

15 warming. I'm not sure that you had the chance to read the

16 statement that was released by the United Nations

17 yesterday, but the head of the U.N. released an urgent

18 plea to leaders of the world, especially people like you

19 who are making decisions on global climate change.

20 They estimate 200 million people will be climate

21 change refugees in the next 15 years.

22 CHAIRPERSON SAWYER: Would you please conclude.

23 MS. WILLIAMS: In conclusion, so your actions

24 today are being watched by the world, and that is the

25 reason why. Literally, because people's lives are

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345193

1 depending on the path that we take.

2 Thank you so much.

3 CHAIRPERSON SAWYER: Thank you.

4 Mr. Hwang. And then we'll have Rupal Patel, Leo

5 Miras, and Bonnie Holmes-Gen.

6 MR. HWANG: Good afternoon, Chairman Sawyer and

7 members of the Board. My name is Roland Hwang, I'm the

8 Vehicle Policy Director with the Natural Resources Defense

9 Council. NRDC would like to weigh in on support for the

10 adoption today for the Group One measures. But very

11 clearly, also, want to encourage inclusion of three very

12 specific measures on heavy-duty trucks, cement, and ports,

13 which my colleague, Diane Bailey, who I believe will be

14 speaking a few speakers later, will get into more detail.

15 So we support Group One. But we do want to also weigh in

16 in support with many other groups here that we need to

17 include more measures.

18 I think a lot what we hear today on the Low

19 Carbon Fuel Standard, I'd like to talk about that a little

20 bit, is a balancing act which the Board has to consider.

21 On one hand, there's an urgency to solve global warming

22 and a move to low carbon fuels that are sustainable. On

23 the other hand, we have to do this in a prudent manner to

24 make sure there's not inadvertent consequences.

25 I would like to put my thumb on the scale for the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345194

1 urgency side of this equation. Not to say that we

2 shouldn't do this correctly. I believe we have time to do

3 it correctly. But there is an urgency and in our

4 comments, and we just released a report called "Driving It

5 Home," I believe it should be in your packet, where we

6 just released a report talking about the dangers of where

7 we're headed with liquid fuels, which coal liquids, oil

8 shale, all have huge impacts on lands and on communities

9 and, of course, on global warming. Coal liquids is a

10 subject of discussion of massive federal subsidies in

11 Washington now and could double greenhouse gases.

12 So we believe it is critical to send a signal to

13 the marketplace now, in order to discourage, to slow down

14 these investments. Without a Low Carbon Fuel Standard,

15 without moving towards solutions on global warming, we'll

16 be ending up filling up in ten, 20 years or sooner with

17 high carbon fuels made from coal liquids. So we're very

18 concerned about that.

19 We do want to have three specific recommendations

20 to the Low Carbon Fuel Standard. The world is watching.

21 We want to have this done right. The first one is very

22 critical one, I'm sure there's no backsliding in air

23 quality and we do want to make sure there is proper

24 incentives for the cleanest, for example, renewable

25 electricity powering plug-in hybrids, that's a very clean

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345195

1 pathway. Sure -- and ensure no backsliding in air

2 quality.

3 Second, we do believe that the Air Resources

4 Board should evaluate and address any kind of a potential

5 for adverse impacts on environmental justice on local

6 communities and address environmental justice impacts.

7 Finally, we believe that it's very critical in

8 terms of getting the measurement right, so we do support

9 inclusion, when we're measuring the greenhouse gases, the

10 impacts on land conversion and also fertilizers.

11 We will support -- and I realize my time is up,

12 Chairman Sawyer, so I'm almost done. And NRDC will be

13 happy to participate in whatever process the Air Board

14 staff believes is appropriate in order to come up with the

15 right measurement for a full fuel cycle greenhouse gas

16 emissions.

17 Thank you for your attention.

18 CHAIRPERSON SAWYER: Thank you. And we look

19 forward to working with the UCS on the technical details.

20 MR. HWANG: NRDC.

21 CHAIRPERSON SAWYER: NRDC. Excuse me. One job

22 back.

23 MS. PATEL: Good afternoon. My name is Rupal

24 Patel, and I represent an organization called Communities

25 for Clean Ports. It's a non-profit/profit public

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345196

1 education campaign based in Los Angeles.

2 First, I'd just like to say that since the

3 beginning of this process, our biggest fear has been that

4 the ARB staff is overly relying on the Clean Air Action

5 Plan sponsored by the ports of Los Angeles and Long Beach

6 to reduce port pollution impacts. And for two specific

7 reasons.

8 One is that the Clean Air Action Plan is a

9 five-year commitment, merely a set of promises by the

10 ports of Long Beach and Los Angeles, and at any point,

11 they could, you know, decide to retract the environmental

12 standards that they push in the lease agreements and then

13 we're kind of left at the same place that we are right

14 now.

15 The second reason is that there are over ten

16 other ports that operate along the coast of the state.

17 And so, you know, state standards and state regulations on

18 the port industries are absolutely critical in reducing

19 port pollution.

20 And as outlined in the Air Resources Board

21 Emissions Reductions Plan for Ports and Goods Movement,

22 pollution from port-related industries is responsible for

23 a host of costly ills in California. 2,400 annual

24 premature deaths, 75 percent of all diesel particulate

25 matter, and 30 percent of all NOx, and billions in health

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345197

1 costs. Goods movement is a profitable industry. A 300

2 billion dollar per year business at the Los Angeles ports

3 alone, and viable, cost-effective, clean technologies and

4 alternative fuels exist today to cleanup the industry.

5 So Communities for Clean Ports advocates for the

6 strongest most aggressive regulatory measures and industry

7 practices to end port pollution poisoning throughout the

8 state.

9 To that end I'd like to submit to you a petition

10 signed by nearly 5,000 Californians. The petition read in

11 part: I urge you to reverse your decision to leave goods

12 movement pollution reduction strategies out of your early

13 action measures for addressing global warming. By

14 limiting PM and NOx pollution as part of your early action

15 measures, the Air Resources Board can act aggressively to

16 improve air quality and reduce greenhouse gases.

17 Specifically, I believe CARB should include the following

18 early action measures. Require the cleanest available

19 heavy-duty trucks. Require the cleanest available

20 cargo-handling equipment, and require oceangoing vessels

21 to use cleaner shore-based electrical power. As the

22 state's chief air quality regulator, the Air Resources

23 Board is responsible for protecting the health of millions

24 of Californians, residents suffering from goods movement

25 related pollution, and for upholding Governor

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1 Schwarzenegger's promise to fight global warming. So it

2 is vital that you use all your resources at your disposal

3 to aggressively limit deadly goods movement pollution

4 emissions. Especially since trade is protected to triple

5 or quadruple over the next decade or so.

6 In closing, on behalf of Communities for Clean

7 Ports and nearly 5,000 people who have signed this

8 petition, I urge you to include aggressive regulations on

9 goods movement in your early action measures for AB 32.

10 Thank you.

11 CHAIRPERSON SAWYER: Thank you.

12 Mr. Miras.

13 MR. MIRAS: Good afternoon. My name is Leo Miras

14 with the Environmental Health Coalition. I'm here today

15 in support -- to speak in support of AB 32 Environmental

16 Justice Advisory Committee's early action proposals number

17 27 and 28. That's the promulgation of rules covering

18 aging power plants for the purposes of their phase-out.

19 And we believe that it is both necessary and a viable

20 measure for the elimination of adverse emission impacts.

21 You heard my colleague, Laura Hunter, speak about

22 this earlier.

23 What I want to to deal with specifically is

24 something staff commented in introducing these two points,

25 was that they didn't want to interfere with the work that

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1 ARB is doing with the CEC and the PUC in regulating these

2 old power plants in regards to their greenhouse gas

3 emissions. And what that's based is from SB 1368 which

4 was the companion legislation, AB 32. And what that does

5 is, it just prohibits long-term financial commitments

6 between utilities and base load generators that don't

7 comply with this emission standard that the CEC and the

8 PUC, with ARB's consultation, with that -- if they don't

9 meet that standard, then that's when this law kicks in..

10 We think that for communities that are suffering

11 in the shadow of these old power plants that are highly

12 inefficient and highly polluting, that ARB needs to take a

13 front seat in terms of driving this phase-out and in terms

14 of getting rid of these old power plants. And also, the

15 other problem with 1368, it only deals with long-term

16 financial agreements, no short-term contract -- I mean

17 short-term contracts don't fall into their purview, so you

18 can have old power plants being run in perpetuity with

19 short-term contracts and short-term leases.

20 And also, it's a regulatory bill. It deals with,

21 sorry, with the utility regulation. So you're not

22 focusing on the air pollution impacts that we feel would

23 be dealt with if ARB put its resources, and this broad

24 AB 32 mandate, that we think we can start reducing

25 greenhouse gas emissions in a very, very effective way as

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1 well as provide these long-suffering communities some

2 relief.

3 So in closing, I just wanted to say, to look at

4 the proposal and to accept it. And that's it.

5 Thank you very much.

6 CHAIRPERSON SAWYER: Thank you.

7 Ms. Holmes-Gen. And then we'll have Jill Whynot,

8 Diane Bailey, and Mike Sandler.

9 MS. HOLMES-GEN: Good afternoon, Chairman Sawyer,

10 members of the Board, Bonnie Holmes-Gen with the American

11 Lung Association of California. The American Lung

12 Association is working very hard to reduce greenhouse gas

13 emissions and implement AB 32 because of the impacts of

14 global warming on increasing smog and soot emissions in

15 those serious public health impacts that would result.

16 We believe the list of early action measures is

17 extremely important and significant. That's why we're

18 here today. With this list, you are setting early

19 regulatory priorities for the global warming programs at

20 the state. And you are affirming the importance of

21 regulatory mechanisms as a key and central part of AB 32

22 implementation. And you have the opportunity today to

23 ensure that the measures with important criteria pollutant

24 co-benefits, such as diesel control measures, are on the

25 top priority the category one list. And that's one of our

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345201

1 key asks. In this way, the early action list can have a

2 more immediate health impact on the communities throughout

3 the state and can set an important model for other states

4 and countries to follow.

5 We believe that given the public health epidemic

6 of air pollution, the high numbers of premature deaths,

7 asthma attacks, hospitalizations, and lung damage that's

8 occurring, especially in children, that's extremely

9 important to make simultaneous progress on both the

10 criteria pollutant programs and the greenhouse gas

11 programs simultaneously. And those can be blended

12 together in this early action list.

13 With this in mind, we are supporting the measures

14 that are currently on your early action list and we are

15 urging you to expand the list and to include a more robust

16 list of measures. Specifically, we have asked to include

17 the heavy-duty truck emission reduction measures on the

18 Group One list, and you've heard some comments about that.

19 Those are the smart way improvements. We are urging you

20 to move up port electrification and other port diesel

21 reduction measures to Group One list to ensure that

22 communities near the ports benefit from the earliest

23 possible emission reduction benefits, and to add a measure

24 for anti-idling enforcement into the Group Two

25 implementation to increase enforcement staff and ensure

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345202

1 stronger compliance among the 500,000 or more on-road

2 trucks and the hundreds of thousands of off-road vehicles.

3 This can be done through, again, increasing staff,

4 designing enforcement programs to include better outreach,

5 and coordination with local air districts. And better

6 outreach to the regulated community, to get more

7 consistent and widespread compliance with diesel measures.

8 We think this is an obvious measure that should be very

9 high on your list.

10 We are also supporting, in conclusion, we are

11 also supporting the Low Carbon Fuel Standard as a key

12 mechanism to promote transition to cleaner alternative

13 fuels. However, we do believe that environmental

14 safeguards are needed, especially air quality safeguards

15 to protect against backsliding on our quality commitments

16 and safeguards to ensure that fuel are produced

17 sustainably.

18 And even -- I appreciate the comments of

19 Professor Sperling, but still do believe that there are

20 safeguards that need to be written into the regulatory

21 process. And we would be happy to help you with that.

22 Thank you very much for the time to comment and

23 we have also submitted written comments along with a group

24 of environmental organizations.

25 Thank you.

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1 CHAIRPERSON SAWYER: Thank you.

2 Ms. Whynot.

3 MS. WHYNOT: Thank you. Good afternoon,

4 Dr. Sawyer and members of the Board. My name is Jill

5 Whynot with the staff at South Coast Air Quality

6 Management District.

7 First, we'd like to say thank you very much for

8 the opportunity to testify on very a important statewide

9 effort. And I have just a few slides to emphasize our

10 comments today.

11 --o0o--

12 MS. WHYNOT: Next slide, please.

13 --o0o--

14 MS. WHYNOT: First, we urge you to strengthen the

15 early action measures. We have some specific suggestions

16 for additional measures that will not only reduce

17 significant amounts of greenhouse gas, but maximize the

18 co-benefits that are needed for the State Implementation

19 Plan. Also, we concur with CAPCOA that it's really

20 important to prioritize the existing SIP strategies so

21 that when you can get greenhouse gas, toxics, criteria

22 pollutants, those strategies should move up the list and

23 be done first.

24 Also, we also believe that existing local air

25 districts can offer quite a bit. We can evaluate existing

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345204

1 rules and where we identity gaps, where one district may

2 have a program that would be of value statewide, we can

3 fill those gaps, especially for stationary sources through

4 our rulemaking efforts.

5 And I'd also like to echo for the CAPCOA

6 comments, the best time for a new project to cost

7 effectively reduce its impacts on criteria, toxics,

8 greenhouse gases, is in the design phase. So we really do

9 we need to work on a CEQA and a new resource review type

10 process so that we can make sure that projects that are

11 being built in the next few years start off on the right

12 foot.

13 Next slide, please.

14 --o0o--

15 MS. WHYNOT: We also urge CARB to take advantage

16 of the partnerships that we're offering. Local air

17 districts, in addition to adopting the rules, are engaging

18 through CAPCOA, we'd like the work with ARB on developing

19 the CEQA, not only thresholds, but also compiling

20 mitigation measures because this's very important. You

21 get a project and you can come up with a list of suggested

22 mitigations, you can take care of a lot of the impacts

23 that that project might bring. And also we want to work

24 with CARB and others on a new resource review type

25 process.

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1 Next slide, please.

2 --o0o--

3 MS. WHYNOT: Here's some specific suggestions

4 where we think that the staff proposal could be

5 strengthened. We have two specific additions to the early

6 action measures.

7 The first is to accelerate the use of hybrid

8 technologies. This is well-known, generally accepted

9 technologies and we think through incentives and

10 regulations that the turnover rate and the use of these

11 vehicles could be accelerated.

12 The second has to deal with the heat content or

13 the WOBBE index of natural gas. We have a measure in our

14 plan that would limit that to an index of about 1360. Gas

15 coming into the state can go up to 1380. And this can

16 have a difference in the amount of CO2 two emissions that

17 the state could see. It's a pretty small percentage

18 increase in your carbon. If you go from 1360 to 1380, but

19 because of the vast quantities that are used throughout

20 the state, that could be a significant amount of CO2 that

21 we could avoid.

22 And in addition, increasing the hot gas use also

23 increases your NOx emissions for many different types of

24 combustion. So you'd get a double benefit there.

25 Next slide, please.

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1 --o0o--

2 MS. WHYNOT: We also think that for the Group Two

3 measures which are the ones that are either underway or to

4 be initiated in 2007 to 2009 time frame, we'd like to see

5 very specific dates for adoption and implementation. That

6 will help in the planning efforts, make sure that we get

7 to where we're trying to get. And then also there are

8 four specific measures listed on this slide that we think

9 it's feasible and would be a great thing if those can be

10 moved to be adopted by 2009. So move that up.

11 Next slide, please.

12 --o0o--

13 MS. WHYNOT: There are also three specific

14 measures that we're recommending. These are from our 2007

15 Air Quality Management Plan and we think that these should

16 be added to Group Three as SIP measures that would have

17 significant co-benefits. Not only greenhouse gases,

18 others.

19 --o0o--

20 MS. WHYNOT: And the last slide, in conclusion,

21 we think that there's a great opportunity here to set some

22 leadership and to do some great things for the state's

23 path to reduce the greenhouse gases. I have a blue

24 handout here that summarizes the specific suggestions that

25 we're recommending be changed: That we work to help

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1 prioritize SIP measures. Local districts, including the

2 South Coast, are very willing and have a lot to offer in a

3 partnership with CARB.

4 And then finally, the handout that I have here

5 said that we believe that you should consider the

6 suggestions of the Environmental Justice Advisory

7 Committee and other stakeholders. A lot of great thought

8 has gone into those efforts. And while we don't agree

9 with everything on their list, we think there's a lot of

10 things that have merit and should be considered.

11 Thank you very much.

12 CHAIRPERSON SAWYER: Thank you.

13 Ms. Bailey.

14 MS. BAILEY: Good afternoon, Chairman Sawyer,

15 members of the Board and staff. And thank you for the

16 opportunity to comment here today.

17 My name is Diane Bailey, I'm a scientist with the

18 Natural Resources Defense Council. And I'm here today in

19 strong support of the staff proposal for early action

20 measures to reduce greenhouse gases as my colleague,

21 Roland Hwang, has described to you.

22 I also want to urge you to adopt several more

23 early action measures that would be relatively simple to

24 develop and would add substantial greenhouse gas

25 reductions to the current list.

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1 As the world watches, I hope that this agency

2 will live up to its venerable reputation by taking on its

3 AB 32 obligations to reduce global warming pollutants in a

4 strong ambitious manner.

5 We recommend three measures that are particularly

6 suitable for addition to the early action list and these

7 include heavy-duty truck efficiency, cement industry

8 energy efficiency, and port electrification, which you've

9 already heard a lot about today. Together, these measures

10 can provide more than four million tons of greenhouse gas

11 reductions, in addition to the staff proposed list.

12 We have provided very detailed comments on these

13 measures in writing and I just want to highlight a few

14 more points here today.

15 First, I want to highlight that the measures that

16 we're proposing offer a key opportunity to leverage

17 greenhouse gas reductions with other toxic emissions such

18 as mercury and diesel soot. These measures would rely on

19 existing programs developed by U.S. EPA and other agencies

20 and, therefore, would not require significant staff time

21 compared to other measures. For example, the heavy-duty

22 truck efficiency measure that we propose for early action

23 would piggyback onto the existing heavy-duty truck diesel

24 rule development and incorporate the elements of EPA Smart

25 Way program that you've already heard about.

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1 The elements of Smart Way could be incorporated

2 in a similar fashion as the particulate matter and the NOx

3 retrofits would be required. And as my colleague, Patty

4 Monahan with UCS already to you, some of these measures,

5 including improved aerodynamics, automatic tire inflation,

6 and single-wide tires, could not reduce NOx emissions

7 further, but reduce greenhouse gas emissions by up to ten

8 percent.

9 Many of these measures also pay for themselves

10 quickly through fuel savings, making them highly

11 cost-effective.

12 We believe that all current and future diesel

13 rulemakings offer good opportunity to obtain further

14 greenhouse gas reductions, in addition to diesel PM and

15 NOx reductions. Together with the diesel truck rule, the

16 port electrification rule will help address the poor air

17 quality that many environmental justice communities face

18 throughout California, as you've heard here today. These

19 environmental justice benefits, in addition to the

20 significant greenhouse gas reductions, should elevate the

21 priority of these rules early action status.

22 I also want to take a moment to highlight the

23 cement industry as a very important industry to deal with.

24 I was a little bit concerned that the cement industry was

25 not mentioned as a Group Two item in the staff

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345210

1 presentation. And I'm concluding right now. And we

2 really hope that this agency can work hard to develop a

3 comprehensive set of cement industry measures, treating

4 the cement industry as miniature power plants, as they

5 are.

6 And we urge you to adopt these measures that I've

7 described here today in addition to the staff proposed

8 list. And look forward to working with staff on these

9 measures.

10 Thank you so much.

11 CHAIRPERSON SAWYER: Thank you.

12 Mr. Sandler. And then we'll have Kenneth

13 Smokoska, Julia May, and Philip Huang.

14 MR. SANDLER: Thank you, Dr. Sawyer and members

15 of the Board. My name is Mike Sandler. I'm with the

16 Climate Protection Campaign. For the past six years,

17 we've worked with several local jurisdictions to quantify

18 and reduce their greenhouse gas emissions and develop

19 local climate action plans. I've also worked with the Bay

20 Area Air Quality Management District in the development of

21 their climate protection program and I wanted to just

22 acknowledge and appreciate CAPCOA's recent work on climate

23 protection.

24 I've been following the AB 32 process and I hope

25 to convince you in the next three minutes to adopt an

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1 early action measure which will help accomplish all the

2 other early action measures. I'm writing to -- or I

3 wrote, and I submitted written comments to encourage CARB

4 to consider an early action measure, a carbon permit fee.

5 The fee would phase in beginning in 2008, and the question

6 is how much should the fee be? Right now, carbon is zero

7 dollars per ton in California. That's the status quo and

8 the IPCC has said that's not acceptable anymore. So the

9 question is, how much should a fee be to raise funds to

10 help the Air Resources Board pay for some of its projects

11 and other early action measures.

12 I suggested between five or $10 a ton. Perhaps

13 some of you on the Board might say $1 a ton to start. But

14 zero dollars a ton is no longer acceptable.

15 The early announcement of a carbon fee will lower

16 carbon emissions through millions discrete acts taken by

17 millions of individuals and businesses throughout the

18 state motivated to avoid upcoming costs. So the very

19 announcement of a fee will have an impact right a way as

20 an early action measure. The fee is not a substitute for

21 regulatory activities. It's should just be alongside all

22 of those.

23 A carbon permit fee would help fund many of the

24 immediate activities that CARB is planning to implement.

25 Early aspects of the program could be paid for immediately

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1 by borrowing against future funds anticipated by the fee.

2 We don't want to AB 32 to be an unfunded mandate

3 into the foreseeable future.

4 The fee can be implemented efficiently and

5 rapidly on two major sectors which release carbon

6 emissions. Transportation fuels and electricity.

7 Regarding who pays the fee, the Climate Protection

8 Campaign has advocated an upstream system for the overall

9 cap option system, since upstream is the most

10 comprehensive and easiest to implement. And we've

11 submitted comments to that effect to the Market Advisory

12 Committee.

13 The Market Advisory Committee draft report

14 estimates there are 50 companies that would be affected.

15 So you could probably hire a couple of staff on ARB to

16 find out how much that would be for each of those 50

17 companies and implement this relatively quickly.

18 Creating a carbon fund, which is also sometimes

19 called a "sky trust" with an estimated two to three

20 billion dollars from carbon fees would have an enormous

21 impact on the effectiveness of a carbon reduction program.

22 So I hope that you will consider this as early

23 action measure.

24 Thank you.

25 CHAIRPERSON SAWYER: Thank you.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345213

1 Mr. Smokoska.

2 MR. SMOKOSKA: That's pretty close. Good

3 afternoon, Dr. Sawyer, members of the Board. My name is

4 Kenneth Smokoska, I'm chair of the Sierra Club of

5 California's Energy Climate Change Committee representing

6 almost 250,000 members. And if you thought the Governor's

7 passage of AB 32 was big California energy environmental

8 news, the San Francisco Board of Supervisors voted eleven

9 to zero this week to implement Community Choice Energy

10 Implementation Plan. That's going to be a 50 percent

11 renewable energy plan built out in the confines of the Bay

12 Area by 2017.

13 So when you look at the stakeholder suggestions

14 that weren't included in the early adoption measures,

15 you've got B 23 which would incentivize Community Choice

16 Aggregation Plans with a high RPS content. Why not an

17 early action measure? You know with a carbon tax or a cap

18 N option, that would be a very good mechanism.

19 B 38. The greenhouse gases in the general plans

20 and CEQA, the attorney general's already filed comments

21 regarding the San Diego and San Bernardino General Plans.

22 The Orange County Transportation Plan, I heard earlier a

23 stationary source for a refinery. The local districts are

24 not being utilized nor consulted and they need some

25 guidance and it's sorely lacking. You've got A 22 which

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345214

1 is adopt a regulation to take advantage of emerging hybrid

2 electric technology for medium-duty trucks. Why not all

3 vehicles, and also expand to reinstate the ZEV mandate

4 with a partial hybrid electric vehicle early adoption

5 measure, as long as renewable energy is utilized.

6 When you look at section 38560.5: The

7 regulations adopted by the Board shall achieve maximum

8 technology feasible and cost effective reductions.

9 The San Francisco Implementation Plan by the

10 energy service providers have said that it would be a meet

11 or beat PG&E rates. So you have a huge early adoption

12 measure to be focusing on.

13 Then when you look at section 38561: The State

14 Board shall consider all relevant information pertaining

15 to greenhouse gas emission reduction programs in other

16 localities.

17 Sonoma County should have an implementation plan

18 out which would be a 30 percent reduction of 1990 levels

19 by 2025, out by September.

20 And available time and available staff should be

21 put towards the providing assistance to help accelerate

22 these programs. Many counties have aggressive programs in

23 the works and then we have a sense of urgency, so we

24 should get all these regulatory agencies working together

25 and get on these plans. Because it's not business as

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1 usual.

2 The California IOU's have over 9,000 natural gas

3 power plants, some scheduled to where they're in their the

4 long-term procurement. There's multiple L and G

5 terminals. The State Coastal Commission and State Lands

6 Commission just recently turned down BHP in Ventura County

7 because of the 25 million tons of greenhouse gases just

8 with that one terminal.

9 Thank you for your consideration.

10 CHAIRPERSON SAWYER: Thank you.

11 Ms. May.

12 MS. MAY: I have a PowerPoint presentation.

13 Sorry, that's not mine. Julia May. And I'm hoping you

14 have the copies of the right one as well. Communities for

15 a Better Environment. CBE. That's it. Thank you.

16 --o0o--

17 MS. MAY: Okay. I'm Julia May from Communities

18 for a Better Environment. I'm a senior scientist. I want

19 to direct your attention to the largest California

20 industrial source that's entirely missing from the

21 greenhouse -- from the early action items.

22 And the second slide, you see that the -- next

23 slide please.

24 --o0o--

25 MS. MAY: The California Public Utilities

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1 Commission found that industrial facilities make up about

2 23 percent of the state's total, 40 percent of that is oil

3 refineries. That means refineries are about 10 percent of

4 the state's greenhouse gases. The same as in-state power

5 plants. That has -- that's a fact that most people

6 haven't focused on anywhere. It's a big source.

7 Unfortunately -- next slide, please.

8 --o0o--

9 MS. MAY: -- it's getting bigger. Oil refineries

10 have been and are continuing to accelerate their switch to

11 dirty crude. Even before we get the Canadian tar sand,

12 this is already happening in the state. That means more

13 dirty crude in, more carbon, more sulfur, more heavy

14 metals. We got less sulfur going out of the refineries

15 because of our important California fuel standards. That

16 means more carbon, more SOx, deadly H2S gas inside the

17 refinery, more risk of upset for neighbors. This is an

18 environmental justice hazard to community. It also means

19 a lot more CO2. We've got more energy intensive cracking,

20 coking, hydrogen plants, hydrotreating sulphur recovery

21 going on.

22 Next slide, please.

23 --o0o--

24 MS. MAY: I just want to let you know that

25 they're building in an infrastructure that's going to last

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1 for the next several decades. Right now, it's becoming

2 much more carbon intensive. Conoco-Phillips got

3 mentioned. We've getting a case on that, and the AG's

4 office is filing on that. One and a quarter million

5 metric tons per year of CO2 from that one plant. All the

6 plants I could come up, not a comprehensive list, are

7 almost 6 billion metric tons of new CO2. This is wiping

8 out a lot of the early action items that you guys are

9 trying to do. It's actually going backwards. And the oil

10 refineries are building this in for decades.

11 Next slide, please.

12 --o0o--

13 MS. MAY: We're asking that you add an early

14 action item that would require a ground up energy audit

15 for oil refineries. The items are already identified,

16 they're not rocket science, they're not technology

17 forcing. We've got a lot of issues identified by the

18 Lawrence Berkeley Labs, we've identified some. The air

19 districts have identified a lot.

20 If you require that they start doing the energy

21 audit now, this will be effective.

22 Please, on next slide 'cause I'm going to run out

23 of time.

24 --o0o--

25 MS. MAY: We need to remove the methane

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1 exemptions in the VOC regs for refineries. When we did

2 audit on flares in the Bay Area and South Coast, we found,

3 at first they thought that emissions were 0.1 tons per

4 day. When they audited, they found many tons per day of

5 VOCs. The audit itself can identity the gaps at each

6 refinery. Then it's easy to identity the ways to clean

7 this up. The pollution prevention measures that clean up

8 the CO2, and in conclusion, these also clean up the smog,

9 the toxics, the risk of upset the neighbors face. It's

10 the same thing that we need to do anyway in the

11 neighborhoods to protect the public health and we need to

12 do it right now because it's going to get a lot worse for

13 the refineries.

14 If you've got any questions.

15 CHAIRPERSON SAWYER: Thank you very much.

16 MS. MAY: Thank you very much.

17 CHAIRPERSON SAWYER: Mr. Huang. And then we'll

18 have Joseph Bishop, Bill Karambelas, and Albert Cohen.

19 MR. HUANG: Good afternoon, Dr. Sawyer, members

20 of the Board. I'd just like to follow-up on my colleague

21 Julia May's comment. Also with Communities for a Better

22 Environment, a nonprofit, community-based organization

23 combining science, legal advocacy, and community

24 organizing. And you'll from all our aspects today.

25 The gravity of the IPCC report's conclusions

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1 should be matched by the boldness and breadth of the

2 measures that your agency adopts today. ARB's mission is

3 to protect public health. Therefore, we think ARB should

4 kill two birds with one stone. It should endorse a broad

5 slate of measures that would reduce both greenhouse gases

6 and traditional pollutants, such as smog forming

7 chemicals, particulate matter, and toxics. And you've

8 already heard sort of what our measures that CBE has

9 recommended and that were endorsed by the Environmental

10 Justice Advisory Committee through a long process. They

11 didn't just rubber stamp, they really asked us question.

12 And it's a light blue paper that's may be attached to the

13 end of the PowerPoint.

14 You know, require recycling of waste gases at

15 refineries, eliminate the methane exemptions to

16 refineries, implement energy efficiencies measures.

17 Including an energy audit. Energy audit is something you

18 can start right now. It doesn't have to wait until 2010

19 scoping plan, et cetera.

20 We believe that staff's characterization of the

21 law is somewhat inaccurate. AB 32 implementation should

22 compliment efforts at achieving air quality standards,

23 that's what it says in the law. That means more than just

24 avoiding negative impacts. It means affirmatively acting

25 and complimenting what we're trying to do to reduce

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1 criteria pollutants and inter-air toxics. And that's why,

2 you know, we support the rest of the EJAC recommendations.

3 The one's that the environmental groups endorsed about

4 ports and, you know, diesel.

5 Furthermore, these early action measures that,

6 including ours, reduce local pollution that protects the

7 health of the state's most vulnerable residents, the ones

8 who live in refinery communities around ports. We

9 shouldn't pass up this opportunity. An ounce of pollution

10 prevention is worth a pound of cure. Reducing measures

11 today means that we avoid -- we help avoid the kicking in

12 the negative feedback loop that the IPCC presenter talked

13 with the melting ice sheets. Greenhouse gas causes heat.

14 The heat melts the ice. The ice release more greenhouse

15 gases. That's not industrial pollution, that's, you know,

16 greenhouse gases causing more greenhouse gases. And, so,

17 therefore, reducing carbon and other greenhouse gases

18 today is so much more effective, cost-effective than

19 reducing them later.

20 And furthermore, you know, as the staff report

21 indicates, you know, conventional pollutants such as

22 particulate matter and other things, have short-term

23 carbon impact. So if we reduce them now, that would

24 reduces carbon now as well.

25 So in conclusion, I'd just like to say please act

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1 early and often on the early action measures and protect

2 the public health of our state's most vulnerable

3 residents.

4 Thank you

5 CHAIRPERSON SAWYER: Thank you.

6 Mr. Bishop.

7 All right. Mr. Karambelas. Mr. Bishop? No.

8 Mr. Cohen?

9 MR. KARAMBELAS: I'm Bill Karambelas.

10 CHAIRPERSON SAWYER: Oh, okay, fine. Thank you.

11 MR. KARAMBELAS: And I have a presentation.

12 --o0o--

13 MR. KARAMBELAS: Okay. Very good.

14 Yes. My name is Bill Karambelas. I'm

15 Vice-president with Fuel Cell Energy. I'm also

16 representing the large stationary manufacturers of fuel

17 cells today. And this presentation is put together by the

18 National Fuel Cell Research Center, which is based down at

19 U.C. Irvine and is funded by the Department of Energy and

20 headed by Dr. Scott Samuelson.

21 Next slide, please.

22 --o0o--

23 MR. KARAMBELAS: Just a quick overview on fuel

24 cells. It's electricity generated by electrochemical

25 reaction, not by combustion. This leads to much higher

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1 electrical efficiency than traditional generation and much

2 lower emissions. Thirty percent of the installed base in

3 California today run on renewable or digester gas or

4 methane gas. Sixty percent installed capture waste heat

5 through co-generation or combined heat and power. As an

6 emerging technology today, the 18 megawatts of installed

7 fuel cell capacity could easily exceed 3200 megawatts by

8 2020 with a long term balance portfolio of incentives.

9 These include mandated CHP or a combined heat and power

10 portfolio requirements. Continued upfront capacity-based

11 incentives coupled with performance-based incentives. And

12 the removal of utility barriers. There's an asterisk on

13 this presentation, which I believe all the Board members

14 have, and it will highlight as California Energy

15 Commission Report from November 2005. In section H,

16 there's a very extensive of barriers.

17 Next slide, please.

18 --o0o--

19 MR. KARAMBELAS: In the interest of time, I'll

20 draw your eye to the right side of this graph. This is

21 the annual emissions reduced per one megawatt capacity of

22 fuel cells versus California natural gas-fired power

23 plant. As you can see, one of the -- two of the wonderful

24 technologies that the state's embraced are wind and solar.

25 Although, they take no fuel and have incredible benefits

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1 for the state, they're intermittent in nature. The sun

2 shines when it shines, the wind blows when it blows. The

3 fuel cells are a base-loaded or a 24/7 technology.

4 Therefore, we run continuously.

5 So if you look on the right-hand side and all

6 criteria pollutants and CO2, you can see that fuel cells

7 actually outshine wind and solar, and in some cases with

8 both of them combined, is the case, CO.

9 Next slide.

10 --o0o--

11 MR. KARAMBELAS: We have a view in 2020, that we

12 can put 3,200 megawatts of fuel cells in place here in

13 California. That would reduce 4.4 metric tons of CO2.

14 Natural gas savings of about 674 million MMBTUs or enough

15 to power about 11. 4 million homes. We believe strongly

16 that fuel cells are a necessary contribution to enable

17 California to achieve its AB 32 goals.

18 Next slide.

19 --o0o--

20 MR. KARAMBELAS: Today, fuel cells are creating

21 6.6 to 19.6 cents per kilowatt hour of value to California

22 ratepayers.

23 And the final slide, if I could have one more

24 moment in conclusion.

25 --o0o--

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1 MR. KARAMBELAS: -- is our waterfall or value

2 build up of fuel cells in California. And we have

3 extensive background on these numbers and be happy to

4 forward it to you. It's basically the same folks who put

5 together the California Solar Initiative numbers.

6 Thank you.

7 CHAIRPERSON SAWYER: Thank you.

8 Mr. Cohen. And then we'll have Jim Stewart,

9 Rachel McMahon, and Howard Gollay.

10 MR. COHEN: My name is Albert Cohen. I'm

11 Director of the Southern California Ecumenical Council,

12 which is a church council comprised of 18 denominations

13 and representing thousands of congregations in this state.

14 We've been active in environmental affairs since 1972.

15 I want to talk about time.

16 Friends, there is an emergency here. The red

17 light is on for the petroleum civilization. What we have

18 here today is in conclusion. That's where we are in terms

19 of the pressure that's on us, because this is a biological

20 situation we're in. We've heard a lot about chemistry.

21 We've heard a lot about physics today. But it is biology

22 that is the point.

23 The Earth is a living, breathing organism which

24 is ill. It takes time to get sick and it takes time to

25 get well. Some people would say we've got a terminal

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345225

1 illness here. Hopefully, it's not going to be that. But

2 it will only not be a terminal case, if we are active now.

3 I mean, what we're talking about that should

4 happen in 2010, what should happen in 2020, needs to

5 happen immediately.

6 We agree with Dr. Sperling that money is not the

7 issue. We're not talking about cost-effectiveness here.

8 We're talking about Hurricane Katrina. We're talking

9 about pouring millions of dollars into solving this

10 problem now.

11 The staff. The staff should be doubled. The

12 staff should be tripled. There should be no question

13 about having enough people to do the job. When we look

14 back -- I remember in 1970, how far the year 2000 seemed

15 to be. Well, the year 2000 came in a big hurry, and the

16 year 2050 is going to come in a big hurry, and if we

17 haven't acted now, it's going to be too late, folks. It's

18 going to be over.

19 We at least owe that to our children and our

20 grandchildren, that they would have an opportunity to live

21 on this planet.

22 The IPCC, the Stern report, all of these

23 scientific reports indicate that there is a crisis. So

24 I'm asking you to demonstrate courageous leadership at

25 this point. You have the opportunity. Be bold. And

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345226

1 produce some public policy which is going the solve this

2 problem now.

3 Thank you for listening.

4 CHAIRPERSON SAWYER: Thank you.

5 Mr. Stewart.

6 MR. STEWART: I'm Jim Stewart, the Chair of the

7 Angeles Chapter of the Sierra Club's Global Warming

8 Committee. And I want to substantiate. I have a Ph.D. in

9 physics. I know, and I really sympathize with the people

10 that have presented the IPCC report as, you know, data as

11 of 2005, which, of course, is totally inadequate.

12 --o0o--

13 MR. STEWART: And so this is the slide that the

14 IPCC reported. Right? The worst possible scenario that

15 they considered was the red line up at the top.

16 --o0o--

17 MR. STEWART: And the optimistics ones were the

18 ones where we could get 450 stabilization at the bottom

19 green line or something there in the middle a little bit.

20 But let's look at the latest data.

21 The next slide, please.

22 --o0o--

23 MR. STEWART: The next slide shows that the

24 actually data, and the most reliable data is in the white

25 circles because the black circles don't include the recent

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345227

1 results from China, which I can talk about in a minute.

2 Look at those white circles. They're above the red line.

3 They're above the worst possible scenario that was

4 considered by the IPCC.

5 Folks, this is a planetary emergency. I like

6 what Supervisor Hill said. We're going to let a little

7 staff shortage or a little pressure on the staff here to

8 avoid action on a planetary emergency like that? I sure

9 as heck hope not.

10 I want to say that you guys have the obligation

11 to the world to set these early action measures to be the

12 most emphatic you can get them. It's your opportunity to

13 shape history for this planet. And I hope that you're

14 going to propose some amendments to boost up, like the

15 Environmental Justice Coalition said, there's a lot of

16 those measures that need to be in the early action.

17 You need to take responsibility for this, and all

18 of us, all of the six and a half billion people on this

19 planet, are looking at that curve and saying this is your

20 time to stand up and be counted.

21 Thank you.

22 CHAIRPERSON SAWYER: Thank you.

23 Mr. McMahon. Excuse me. Ms. McMahon.

24 MS. MCMAHON: Good afternoon. My name is Rachel

25 McMahon and I represent the Center for Energy Efficiency

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345228

1 and Renewable Technologies. Our organization is a

2 consortium of environmental groups and renewable energy

3 technology companies.

4 Now, we've made recommendations to the Climate

5 Action Team and are working with the CEC and PUC on energy

6 issues. But I did want to take the opportunity today to

7 say a few words about our energy system, because

8 eventually the question of how to address our energy

9 system from a climate perspective will come to this body.

10 Greenhouse gas emissions from our electric sector

11 have been increasing far more than any other sector

12 including transportation. We have a renewable energy law

13 and policy, energy efficiency targets and policies, a

14 California solar initiative, and now a new global warming

15 law. Yet at the same time, renewable energy development

16 lags in the state. There are barriers to deployment of

17 ultra clean distributed generation such as solar and fuel

18 cells and solar thermal technologies. And thousands of

19 megawatts of new gas fired peaking and base load power

20 plants are being approved in communities throughout the

21 state.

22 Achieving our climate goals in the energy sector

23 for 2020 and beyond will require that our energy system

24 will be a lot cleaner and more efficient and a lot

25 different than it is today, and this requires integrated

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345229

1 resource planning. Across all energy agencies and all

2 utilities.

3 We must develop our wealth of renewable energy

4 resources and transmission to access them. Developing

5 these resources means clean jobs, natural homegrown

6 industry and economic benefits that will accrue directly

7 to the state. We also need greater investments in energy

8 efficiency and ultra clean distributed generation. We

9 need to force technology innovation. But these changes

10 will not be easy or quick. They require planning, long

11 term investment and sustained orderly development, much

12 like infrastructure projects such as highways, levies, and

13 dams. They cannot be approached as a single regulation,

14 and as Dr. Sperling said earlier, it is important to get

15 it right. We believe that government does have a strong

16 role to play in deciding the future of our energy system

17 for the state and the citizens. Neither business as usual

18 nor solely in invisible hand of the market can do this for

19 us.

20 We further urge that CARB move electrification of

21 the ports, as many other folks here have commented today,

22 with clean renewable power and fuel cells. And combined

23 heat and power and co-generation units to a discrete early

24 action measure. The times is now to get the planning

25 started.

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1 This concludes my comments. Thank you.

2 CHAIRPERSON SAWYER: Thank you very much.

3 Mr. Gollay. And then we'll have Kevin Fay,

4 Ricardo Frayre, and Juan Carmona.

5 MR. GOLLAY: Good afternoon, Dr. Sawyer, the

6 Board, and the staff. First of all, I am Howard Gollay,

7 Manager of Corporate Environmental Policy for Southern

8 California Edison.

9 The first thing I want to tell you is that we

10 really appreciate and recognize the importance that the

11 CARB Board, the staff, the Market Advisory Committee, the

12 EJ Advisory Committee, and all the stakeholders are

13 placing in this very important challenge that we all face.

14 I'd just would like to make three points.

15 The first point that is we support the Low Carbon

16 Fuel Standard as an early action.

17 The second point is that I recognize you've heard

18 a lot of differing opinions on this, but for Tiers Two and

19 Three or Groups Two and Three, we do recommend a caution

20 be placed in that we do need to look at a

21 cost-effectiveness. I agree with what Bob Lucas of CCEEB

22 said in terms of developing criteria for what is defined

23 as cost-effectiveness. And we also have to look seriously

24 at the, how the different items would fare better under a

25 market-based program in terms of offsets or as a mandatory

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345231

1 program. And so these various initiatives are being

2 looked at Groups Two and Three as well as others. You

3 need to make the decision whether they'd better under a

4 market-based program or a mandatory program.

5 Finally, I was taken in by the comments of

6 Dr. Sperling about spurring -- sparking innovation. And

7 one way to spark innovation is through encouraging

8 companies to take voluntary early actions. Companies

9 would like to try -- would like to do that. To do that

10 they will need some type of incentives, they'll need some

11 type of promise or credit for early actions that are

12 taken.

13 And this start has been echoed by other

14 businesses today, as you know, as well as by the

15 Environmental Defense. The -- so I would suggest that the

16 implementation details of how you conduct a voluntary

17 program needs to be worked out as soon as possible.

18 As Bob Lucas had mentioned, we suggest as well,

19 that CARB consider to do voluntary programs on a

20 case-by-case basis so that a company -- so that it

21 provides opportunities for companies to take actions and

22 we can all learn from the experience before a firm

23 regulatory action or mandate is in place concerning those

24 various actions.

25 Along those lines, I say this, recognizing the

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1 resource constraints that we all face, is I would ask the

2 CARB Board to direct the staff to look also strongly at

3 this issue and to come up with a recommended path toward

4 voluntary early actions. Everyone talks about voluntary

5 early actions. Let's talk about globally. It's hard --

6 it's a challenge to operationalize, we're willing to help

7 to operationalize, others stakeholders are willing to help

8 as well. But let's try to make the effort. And this way,

9 California can lead.

10 Thank you.

11 CHAIRPERSON SAWYER: Thank you very much.

12 Mr. Fay.

13 MR. FAY: Thank you, Mr. Chairman, members of the

14 Board. I represent the International Climate Change

15 Partnership, a coalition of manufacturers and trade

16 associations committed to responsible participation at the

17 state, federal, and international level on climate policy.

18 We're here today generally supportive of the

19 three early action strategies that have been proposed. We

20 are a little bit concerned, however, and do not support

21 the immediate expansion of the Group One list. We believe

22 that many of the Group Two measures are not yet ripe.

23 Because of lack of data availability or that more

24 cost-effective approaches may be available through

25 market-based mechanisms, including the work being done by

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345233

1 the Market Advisory Committee.

2 We believe that the Air Resources Board should

3 focus on development of emission reduction strategies that

4 do not rely solely on technology bans. Climate change

5 policy globally has favored market-based emission

6 reduction strategies and programs rather than technology

7 bans and we note that many of the proposed strategies are

8 performance-based. But some are not.

9 We're also are questioning the official status of

10 the Group Two strategies. Information presented by the

11 staff today contains a timetable that was not previously

12 available publicly. And if today's actions beyond the

13 Group One items is considered a commitment to a firm

14 regulatory agenda, we're concerned that the schedule laid

15 out needs these further discussion.

16 With respect to the HFC can strategy, previously

17 adopted federal ozone regulations limited sale of these of

18 these cans to certified technicians. Our reading of the

19 Federal Clean Air Act agreed to by the EPA General Counsel

20 prohibits the vending of HTFCs during service of AC and

21 refrigeration equipment. We are proposing -- EPA

22 considers that currently, however, to be self-enforcing.

23 We're prepared to work with ARB staff and federal EPA for

24 more effective enforcement this federal law. We are

25 sympathetic to the economic concerns expressed by the EJ

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345234

1 Committee, but we also believe that a distinction must be

2 drawn between repair of motor vehicle air conditioning

3 systems and simply refilling. Federal regulations

4 prohibit the refilling of leaky systems without also

5 repairing them. Those regs, however, have not yet been

6 extended to HFC auto AC service repair. We're committed

7 to working with the staff and the industry on that.

8 Finally, AB 32 requires the state to return its

9 emissions to 1990 baseline levels. And we're curious as

10 to when that baseline will be established. As it will

11 clearly impact the contribution of some of these proposed

12 strategies as well as the issue of credit for early

13 action, which we support. As an example, the high GWP

14 gases were covered under ozone protection regs at that

15 time, but care needs to be taken to have an accurate

16 baseline consistent with ozone protection regs and climate

17 change and the climate change regimes.

18 So we encourage the work that's going to be done

19 on the baseline to be done in an expeditious manner so

20 that industry participants understand where they stand.

21 And on all of these matters, we're prepared to

22 work in a cooperative way with the Air Resources Board and

23 the staff.

24 Thank you for your time.

25 CHAIRPERSON SAWYER: Thank you.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345235

1 Mr. Frayre.

2 MR. FRAYRE: Good afternoon, Dr. Sawyer and

3 members of the Board. I am a private citizen. My name is

4 Ricardo Frayre, and I live nearby. I live in the area, by

5 the way, I see the airplanes fly over me and I see the

6 pollution that they leave in their trails, in the tracks.

7 And I have been working for the space program for

8 the last 17 years, on and off. Continuously for about 13.

9 Doing earth science from space. I've been a contractor

10 and I have focused especially on ocean surface height and

11 I was able to see firsthand the effect of the melting of

12 the ocean ice, I mean, I'm sorry, well, the ocean ice and

13 the polar ice. So we concluded that we have about an

14 increase of three millimeters per year of ocean height

15 and, unfortunately, it's accelerating.

16 I did science analysis. I did flight control

17 operations of space-based observatories. And in the last

18 four years, I've been working on and off on the space

19 program because of funding. Now, I'm translating some

20 books and I'm doing some work on the possibility of

21 extending the range of electric vehicles.

22 Okay. My purpose here is the deep concern I have

23 for the face of the earth and I am here to encourage you

24 to take faster, stronger actions to seek an increase in

25 funding, be it from general funds, from the federal

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345236

1 government, through fees. We need to emphasize public

2 education and support. I want to encourage you to

3 overcome resistance to regulations due to economic

4 considerations.

5 We are facing the dilemma that you may call the

6 pay now or pay later. So we need to overcome that

7 resistance to, well, you take convenience into the money

8 issues, because the price we pay later may be by a factor,

9 increased by a factor of 100 to infinity. Okay.

10 I know many of us resist the so-called nano

11 state. We don't want too many regulations, we don't too

12 restrictions on our freedoms. I can tell you, personally,

13 I'm alive because of those of constrictions, those law, be

14 it the helmet law, the motorcycle helmet law, and the seat

15 belts. Those saved my life. Now I'm grateful. I used to

16 be very, very angry at it. But I'm very grateful now.

17 Anyway, about a year ago, I was looking at some

18 ocean data and I was shaking in front of my monitor at

19 what I was seeing. I have 20 seconds more?

20 CHAIRPERSON SAWYER: Ten seconds

21 MR. FRAYRE: Okay. All right. I found out

22 through called the Gravity Recovery and Climate Experiment

23 that the perennial ice sheet on the ice caps is melting in

24 the northern part, is melting at a rapid rate. It's going

25 to melt completely in seven years. Okay. So I really

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345237

1 wanted to bring that into light to everybody I know, but

2 this very little concern. So I really beg you to focus on

3 that issue, that we may not have ten years like something

4 said. We may have less than that.

5 And I thank you very much for your time.

6 CHAIRPERSON SAWYER: Thank you very much.

7 Mr. Carmona. And then we'll have Jesse Marquez,

8 Jason Barbose, and Jesus Torres.

9 Mr. Carmona.

10 MR. CARMONA: First of all, I'd like to thank you

11 guys for allowing me to speak here in front of all of you.

12 And I'm here to show my support for all the

13 recommendations made by the Environmental Justice Advisory

14 Committee. I strongly believe that in order for this

15 planet to keep on existing and for us humans to keep on

16 existing is to strongly take these new recommendations

17 made by the Environmental Justice Advisory Committee so

18 that we can all successfully be able to keep on living,

19 keep on striving to do the best we can to change the

20 planet, and the way we are are heading right now is not

21 right way.

22 So three measures that you guys have right now, I

23 don't think is at all adequate. We need more measures in

24 the, you know what I'm talking about. Sorry about that.

25 But I'm just speaking from my heart and I know

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345238

1 that you guys have been here sitting all day long,

2 probably tired, wanting some more coffee. Coffee.

3 sipping on it.

4 And I strongly urge to you take all 34

5 recommendations made by the Advisory Committee.

6 Thank you.

7 CHAIRPERSON SAWYER: Thank you.

8 Mr. Marquez.

9 MR. MARQUEZ: Good afternoon, Chairman Sawyer and

10 members of the Board. My name is Jesse Marquez. I'm

11 Executive Director of the Coalition for a Safe

12 Environment. We're headquartered in Wilmington, in Los

13 Angeles Harbor and we have members in 25 cities. I also

14 sit as an alternate on the Global Warming Advisory

15 Committee.

16 I want to begin first by saying that you have a

17 huge responsibility before you. The California residents

18 and public asked for this law to be put forward. They

19 asked the Legislators to pass this law and to move it

20 forward. They are not asking you now to choose the

21 minimum to get by. The public wants the maximum things

22 that can be developed and implemented and adopted. That's

23 what we are looking forward to.

24 Thirty-four recommendations have been made to

25 you. All 34 of the Environmental Justice Advisory

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345239

1 Committee recommendations meet the legal requirement. We,

2 the public, do not want to see them or see any of you to

3 pick and choose what you think sound good, look good or

4 what the staff might think sound good or look good. All

5 34 do meet the criteria and should all be considered and

6 adopted.

7 I do want to point out a few details. During the

8 staff presentation, item number one regarding the improved

9 landfill methane capture. We also added to that. In the

10 case right now, I can take you to Wilmington, to any one

11 of the landfills that have a methane capture system in

12 place, every one of them is leaking. There's one, I know

13 for a fact, that you can go by any day of the week because

14 I've been there about seven, eight times the last

15 nine months, it has been leaking methane every single day.

16 Why? There is no program in place that's monitoring and

17 inspecting the pipes to make sure they are not leaking.

18 Pipes are broken. Pipes are cracked. Seals have broken.

19 And it is leaking. I know for a fact at this one location

20 for a minimum of seven weeks the flare unit wasn't even

21 working.

22 So we need to fix the holes, plug the holes.

23 There are hundreds of tons being released there alone.

24 Another area, in number two, we talk about the HFCs. You

25 see where it mentions about the containers. Okay. What

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345240

1 you don't know is that each shipping container holds 30

2 pounds of freon. You might think in talking with port

3 officials that, yes, the empties do go back. But we have

4 a problem. Only about 25 percent of the empties go back.

5 But prior to recently shipping them back, we have millions

6 of them here in California and approximately five percent

7 of them are refrigeration units that go to what we call

8 our container graveyards. None of this freon is

9 evacuated. I talked to a friend of mine who is a

10 refrigeration mechanic and he was the one that told me

11 they take 30 pounds, they are not evacuated, and basically

12 after 12 months it all leaks out.

13 He also pointed out one other thing. The big rig

14 trucks take 12 pounds of freon. After two years, they

15 leak every single month and have to be refilled every

16 single month.

17 CHAIRPERSON SAWYER: I must ask you to conclude,

18 please.

19 MR. MARQUEZ: So in conclusion, I did pass out

20 two handouts. One was a map, a little color map, that

21 shows you all the toxic facilities in Wilmington, which is

22 only four miles square. Over 80 percent of them are air

23 polluting types as well as global warming gas types. The

24 other one is a chart of refineries put out by the AQMD.

25 And as you can see, it lists all the different pollutants

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345241

1 that come out and it shows your reactive organic compounds

2 at about 2,800. But when we talk about the co-benefits,

3 well, the co-benefits would be another 18,000 tons a year

4 of all the other pollutants.

5 So I ask you and encourage you to do adopt all 34

6 of the EJ recommendations.

7 Thank you.

8 CHAIRPERSON SAWYER: Thank you.

9 Mr. Barbose.

10 MR. BARBOSE: My name is Jason Barbose, and I'm

11 an advocate on global warming at Environment California

12 Research and Policy Center, which is a statewide

13 citizen-based environmental advocacy organization,

14 represents about 70,000 Californians.

15 And thank you, of course, for giving me the

16 opportunity today to speak on this matter. We're speaking

17 in support of the proposed three measures. But more

18 importantly, in support of adding additional measures to

19 the early action list.

20 And my main reason for that, or the main point is

21 relatively simple, which is that science and common sense

22 really tells us we need to act quickly, of course, to

23 reduce in real ways, with real reductions, global warming

24 pollution as soon as possible. And, you know, in adopting

25 the Global Warming Solutions Act last year, the

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1 Legislature recognized this as well. And that's why they

2 knew we needed a two-prong strategy that, yes, of course,

3 on the one hand, created a plan for meeting the 2020

4 target, but at the same time put in place as many real

5 reductions as soon as possible. And it is this early

6 action provision that you're deciding today that embodies

7 that concept.

8 And unfortunately, the original staff proposal

9 does not go far enough. As it stands, of course, the

10 three measures proposed to fulfill the early action

11 requirement of AB 32, it would only result in eight

12 percent of the total emission reduction necessary by 2020.

13 And so we urge the Board to adopt additional early action

14 measures beyond the three that CARB staff originally

15 proposed in order to front load more of the reductions

16 needed by 2020 and implement AB 32 as the Legislature

17 envisioned.

18 And another good reason that provides context and

19 really underscores the need for this Board to do more

20 today, is the fact that more than any other state, and I

21 think it's been noted, California is in a position to pave

22 the way for action on global warming. One thing that

23 probably hasn't been mentioned today is that in Trenton,

24 New Jersey, today, that state is becoming just a second to

25 establish a mandatory statewide cap on global warming

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345243

1 pollution, which is great news. But you can bet that New

2 Jersey, and other states, will be looking to California,

3 will be looking to the Air Board to see where to go from

4 here.

5 And as has been mentioned many times, ARB staff

6 included 23 items on the Group Two list of their staff

7 report, most of which are discrete measures eligible to be

8 added to Group One. In addition, the Environmental

9 Justice Committee has proposed 34 measures. There are

10 many worthy measures among these, as have been spoken to

11 today, the heavy-duty truck efficiency improvements, those

12 are the Smart Way technologies, port electrification,

13 truck stop electrification, cement manufacturing,

14 greenhouse gas requirement, and so on. In general, we are

15 supportive prioritizing measures with co-benefits in

16 reducing toxic and criteria air pollutants.

17 And so in conclusion, solving global warming,

18 it's an immense challenge, but it can definitely be done

19 if we use all of the tools we have at our disposal. On

20 behalf of Environment California, thank you for

21 consideration of additional measures today.

22 CHAIRPERSON SAWYER: Thank you.

23 Mr. Torres. And then we'll have Chuck Helget,

24 Ray Leon, and Jack Gerard.

25 MR. TORRES: Good afternoon, members of the

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1 Board. My name is Jesus Torres, I'm a community organizer

2 with Communities for a Better Environment. I'm also a

3 member of the community of Wilmington.

4 I'm here representing thousands of community

5 members that are not able to make it here, so I'm here on

6 their behalf.

7 We think the ARB should endorse measures that

8 will reduce both greenhouse gases and traditional

9 pollutants, such as smog forming chemical, particulate

10 matter, and toxics. Coming from Wilmington, where we have

11 four major oil refineries and numerous of other sources of

12 pollution that include the ports of Los Angeles and Long

13 Beach, we see the importance of pollution prevention for

14 greenhouse gases. Doing so will help reduce criteria

15 pollutants and toxics in the most vulnerable communities

16 that live on the fence line to some of the worst polluters

17 in the state.

18 These measures are technically achievable and

19 they are cost-effective. Greenhouse gases accumulate in

20 the atmospheres so reducing them early is better than

21 reducing them later. We would like for to you add the

22 Environmental Justice's group proposal to add refineries

23 to the early action measures.

24 Lastly, I want to make a comment about the public

25 participation. The last 13 Environmental Justice

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1 recommendations were not formerly evaluated by staff until

2 today. Even though most of them were proposed in oral and

3 written comments in the spring. Please direct staff to

4 evaluate their effectiveness and place in Group One or

5 Two.

6 Finally, given the concerns about the Low Carbon

7 Fuel Standard, please consider raising the standard 15 to

8 100 percent.

9 Thank you.

10 CHAIRPERSON SAWYER: Thank you.

11 Mr. Helget.

12 MR. HELGET: Chair Sawyer, members of the Board.

13 My name is Chuck Helget and I represent Allied Waste

14 Industries. Allied Waste Industries operates landfills,

15 hauling companies, collection companies, transfer, and

16 processing operations, recycling and composting in

17 California. Allied is generally supportive of the

18 landfill-related discrete early action items, contained in

19 the proposed early action report.

20 We recognize that more effort and investment is

21 needed to ensure that the state will reduce greenhouse gas

22 emissions and we also recognize that more may be required

23 from the solid waste industry, specifically to reduce even

24 more methane emissions from landfills. We are prepared to

25 work with you and your staff on these proposed early

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1 action measures to ensure that the Board has accurate

2 information on which to base their early actions. And the

3 early action regulations that follow.

4 As you move forward, though, we ask that you keep

5 in mind the following points. California landfills are

6 already recovering and destroying methane at a generally

7 realized capture efficiency rate between 80 to 95 percent.

8 In fact, the L.A. Sanitation District's reports to the

9 South Coast Air Quality Management District indicate a

10 capture efficiency exceeding 96 percent. Increasing that

11 capture efficiency rate significantly may very well be

12 technologically difficult and certainly expensive.

13 Further, increasing landfill gas collection

14 efficiency may be, may also increase impurities in

15 landfill gas. Those increased impurities will increase

16 the costs for and reduce the efficiency of landfill gas to

17 energy projects.

18 Finally, while there are around 40 landfills in

19 California, without active landfill gas controls, most of

20 these landfills are very small rural landfills. They most

21 certainly are regulated and they may not be producing

22 enough methane to pose a health and safety risk. Many of

23 these are not producing enough methane to make landfill

24 gas collection either technologically feasible or cost

25 effective.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345247

1 Again, we look forward to working with you and

2 your staff on these items, and thank you for this

3 opportunity to comment today.

4 CHAIRPERSON SAWYER: Thank you.

5 Mr. Leon.

6 MR. LEON: You got that one right. Leon.

7 A pleasure to be here. Good afternoon. And to

8 think I was rushing from the San Joaquin Valley to be here

9 to not miss this item. Wow. Lucky I didn't get a ticket.

10 I don't like those stagnant parking lots you guys got on

11 the freeway, either.

12 But anyhow, my name is Ray Leon. I'm with the

13 Latino Issues Forum. It's a public policy and advocacy

14 institute statewide. I am based in the San Joaquin Valley

15 regional office in Fresno. And we focus on the

16 advancement of the quality of life of low income Latinos

17 and farm workers, throughout the state of California. But

18 as a Latino issues forum, we strongly support the

19 recommendations of the Global Warming Environmental

20 Justice Advisory Committee on proposed early actions to

21 mitigate climate change and urge CARB to adopt these

22 strategies as they are important technologically feasible

23 measures that will significantly and immediately reduce

24 California's overall global warming impact.

25 Having shared that, I would like to speak on the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345248

1 methane digester protocol which is one of the early action

2 measures within the agriculture sector. Of course, as

3 many of you are aware, we, in the San Joaquin Valley,

4 particularly in the southern part, we are becoming home to

5 many mega-dairies, and it's creating a lot of conflict and

6 respect to families, residents don't want to live near a

7 mega-dairy. But this measure will successfully reduce

8 greenhouse gases and also other toxins that are impacting

9 the public health of Valley resident on a daily basis and

10 creating just huge problems that many people cannot

11 afford, either with their health or with their pocket.

12 The wonderful fact of this measure is that it is

13 an existing method being implemented in the Valley, but

14 it's not enough. Only few dairies have this. Currently,

15 a company in the Valley has innovatively implemented this

16 method and has not only been successful in capturing bio

17 gas, but has also created energy with this fuel which

18 could have otherwise been pollution impacting air quality,

19 creating global warming, and consequently the public

20 health.

21 Perhaps you can call this, these livestock

22 plants, potentially. Bioenergy plants. But regardless of

23 what you call it, it works. And it exists, and it is

24 implemented in two few dairies today. We need this at all

25 dairies and other livestock operations. We need the ARB

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1 to create the demand of this solution through enforceable

2 measures, not voluntary measures. This will also enable

3 the advancement of the necessary technology and

4 methodologies that will reduce needed tonnage of emissions

5 in the Valley and for our state.

6 It is being done. It works. Let's expand it

7 throughout the Valley. The livestock operations industry.

8 And let me briefly share, in conclusion, that

9 also to highlight the electrification of truck stops

10 throughout the Valley. That is one of the pollutants that

11 is huge challenge. Judy Case could testify to that.

12 But to conclude, to close, let me just share that

13 while necessity is the mother of invention, strong

14 enforceable measures are the parents of innovative

15 solutions. So you have a big responsibility on your

16 hands, but let's not work with our hands, let's work with

17 our heart and let's be strong on this.

18 Thank you.

19 CHAIRPERSON SAWYER: Thank you.

20 Mr. Gerard. And then we'll have Conner Everts,

21 Tim Carmichael, and Bill Magavern.

22 MR. GERARD: I'd like to acknowledge Dr. Sawyer

23 and the Board. Thank you for giving me the opportunity to

24 speak. My name is Jack Gerard, I'm the general manager of

25 a local fire protection company here in Brea, California.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345250

1 My company protects critical facilities for information

2 technology, for data centers, telecommunications, and

3 including telecommunication facilities that house 911 and

4 DOD operations.

5 As partners, in the life safety and emissions

6 reduction, our industry has been voluntarily regulating

7 itself for years. We've established a voluntary code of

8 practices for the reduction of emissions. We use HFCs in

9 fixed containers, which are controlled by engineer

10 detection and control systems, safeguards are put into

11 place so that one action can't create a false discharge of

12 the system. We don't have the same leak detection issues

13 you might find in moving machinery. Our cylinders are

14 stationary mounted to the wall with no moving parts. HFCs

15 which are used for suppressing fires are virtually

16 non-emissive.

17 There was, in Group Two, a stakeholders

18 suggestions A 3, it was suggested that HFCs for fire

19 suppression be included into the early regulations.

20 Neither the Kyoto protocol or the F gas

21 regulations limit, impose limits on the use of HFCs for

22 suppressing fires. I am concerned that our competitors

23 may use this as a market, to gain market advantage and

24 I've already reportedly heard that they're pointing to

25 this Committee and saying this is the beginning of the end

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345251

1 of our fire protection practice.

2 We suggest that this Committee encourage more

3 industries to voluntarily self-regulate and that credits

4 are used for early action. If you are going to add

5 regulation to our industry, as, you know, having been in

6 this industry for 23 years, I would suggest regulating

7 service and handling practice of the containers, rather

8 than banning the practice all together. And I'm confident

9 that if you use data gathering of non-emergency emissions

10 on clean agents that are used for fire suppression, you

11 could find that it is not emissive.

12 Thank you.

13 CHAIRPERSON SAWYER: Thank you.

14 Mr. Everts.

15 MR. EVERTS: Thank you very much. My name is

16 Conner Everts. I'm representing the Desal Response Group.

17 I want to thank you for coming to Los Angeles. I don't

18 think there's more appropriate place for the discussion

19 we're having today from the harbors to being under the

20 flight pattern of LAX to the number of environmental

21 justice groups and community groups who have stepped

22 forward. And I hope you understand the value of their

23 work and adopt the recommendations from the stakeholder

24 group.

25 My background is really on water issues. For 30

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1 years, I've done demand side and environmental water

2 policy work. And I've kind of been brought to this issue

3 because we no longer have those lines that we stand

4 behind. We have to come together on these issues.

5 I think you have a great opportunity here. And I

6 hope you will take it, today, because you have the

7 combination of public awareness, political support, even

8 community level support and involvement, and much of

9 industry is behind you and much more will come. But you

10 have to make the strong regulations that make that happen.

11 As we've seen in the water world, the only time we've had

12 real advancement in pushing conservation is when there

13 have been strong standards.

14 We're now standing at the floor and we have to

15 look at the ceiling of what we can do, and very directly,

16 the ceiling in terms of the impact of what's happening.

17 We are suffering under a perfect drought here in Southern

18 California. We've had our driest winter on record. We

19 have -- the areas where we get our water from in Northern

20 California, Colorado, remain dry, and, yet, through the

21 very basic water reclamation conservation, we have not had

22 any restrictions. Yet, we can go much further.

23 Nineteen percent of the energy usage, electrical

24 energy usage in the state is due to water. I'm glad DWR

25 was here today, the Department of Water Resources, and

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1 made comments, but we need to do much more.

2 We need not to look for dams and reservoirs and

3 pumping, but we need to look at the demand side programs.

4 I specifically work on ocean water desalination. The

5 proposals include these antiquated dinosaurs of power

6 plants that have been talked about. I'd like to

7 reiterate. We have an opportunity here to close those

8 down, move to greater efficiency, and deal with what is a

9 global crisis.

10 And I hope you take that opportunity today.

11 Thank you very much.

12 CHAIRPERSON SAWYER: Thank you.

13 Mr. Carmichael.

14 MR. CARMICHAEL: Good afternoon, members of the

15 Board. Tim Carmichael of the Coalition for Clean Air.

16 For me, your deliberation today comes down to

17 whether or not you believe that global warming is a

18 crisis. And I presume you do. I presume that because

19 most Californians do, especially those that are informed

20 on the facts. The Governor does. And yet, the proposal

21 before you is not reflective of a sense of urgency or a

22 crisis.

23 I was thinking about this all day long. Think

24 about, people are going to read the L.A. Times tomorrow or

25 hear about this in the news. They've been watching the

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1 Governor and many others, Al Gore and others, Tony Blair,

2 around the world, talk about this crisis, crisis, crisis.

3 They been told that the Air Resources Board is the world's

4 preeminent air agency, the leader, the best team that

5 we've got. And the best we can do is three early action

6 items. It just doesn't add up. And, you know, in fact,

7 I'm reflecting on Ms. Riordan's point earlier about

8 volunteer measures and how important it's going to be for

9 business and individuals to take voluntary action on this

10 issue.

11 What's the motivation for them? What's the

12 message or the signal that this Board sends or this agency

13 sends if the best we can do is three early action measures

14 in the next couple of years? Why would they invest their

15 own money? Why would they change their habits? It runs

16 completely counterintuitive to what the rest of the world

17 is saying we need to do and the sense of urgency that I

18 personally and many, many people feel in this state.

19 I urge you as you think about this, you need to

20 strengthen this proposal. You need to add more early

21 measures, or it just, it really will send a terrible

22 message to people all over the state, committed to doing

23 more on this and wanting to do more, but not, simply not

24 being able to comprehend that this agency is only able to

25 come up with three early action measures.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345255

1 The couple of things I just want to add to that.

2 I really felt that the the staff's response to the

3 Environmental Justice list was disingenuous in a couple of

4 ways. The presentation from staff was, it takes three

5 years for this agency to develop measures, from scratch.

6 Fair enough. But there's nothing before you, nothing on

7 any of those lists that are truly from scratch measures.

8 All of these have been talked about. None of them are

9 truly new. And in fact, when this agency wants to move on

10 something, it moves on it. And it can get something done

11 in three or four months. We've seen it done. And so that

12 doesn't add up.

13 The other thing that didn't add up was the

14 cost-effectiveness, in my opinion, excuse. The fact that

15 this agency hasn't yet defined cost-effectiveness cannot

16 be used as an excuse for not moving ahead with something

17 you're not sure whether it's cost-effective.

18 Thank you.

19 With that I urge you to either put on hold this

20 proposal or significantly strengthen it.

21 Thank you.

22 CHAIRPERSON SAWYER: Thank you.

23 Mr. Magavern. And then we'll have Bill Haller.

24 MR. MAGAVERN: Good afternoon, Chairman Sawyer

25 and Board members. I'm Bill Magavern with Sierra Club,

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345256

1 California.

2 No environmental issue is more important to

3 California than the successful implementation of our

4 Global Warming Solutions Act. A law that we strongly

5 supported when it was passed last year.

6 As you know, a successful implementation will

7 require a mix of strong regulatory standards, incentives,

8 and possibly other market mechanisms. This is going to be

9 a long-term process. But these measures that you are

10 going to list today are the only ones that will be slated

11 for adoption during the first three years of the existence

12 of this law. This is the first major statutory milestone

13 for AB 32 implementation. So this is a defining moment in

14 the beginning of this very important process.

15 And the Legislature that passed this law just

16 last year is watching closely to see how you implement it.

17 I was a witness at the Senate oversight hearing. I've

18 talked with other legislative leaders. I know you have a

19 letter from some of the leading senators so you know that

20 they really want to see a longer early action list. And

21 in the budget that they're considering right now, they

22 have, in fact, offered you additional resources for early

23 action measures.

24 We would like to see a much longer list, but I

25 know your resources are limited so I will focus on a

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345257

1 handful that we're asking you to put on the list today.

2 The heavy-duty truck emissions, port

3 electrification, and energy efficiency standards for

4 cement manufacturing, all will have not only significant

5 greenhouse gas benefits, but also help to clean our air of

6 the emissions that are causing smog and air toxics.

7 The cement plants are the biggest sources of

8 airborne mercury in the state of California. And I'm

9 concerned that one of the objections I hear to putting the

10 cement efficiency measures on the early action list is

11 well, cement would be a good candidate for a potential

12 market mechanism, meaning a trading program to come later.

13 And I don't think it's a question of either/or. You can

14 have a strong performance standard. You should have a

15 strong performance standard. That will only benefit both

16 the environment and the economy of the state, and

17 certainly doesn't preclude you from including that into a

18 future market program.

19 I also think we've heard that it would not be

20 difficult to add the cool paints for motor vehicles to the

21 list and I would urge you to adopt that today.

22 I want to thank the staffs of both the Air Board

23 and the Waste Board for adding the landfill methane

24 emissions to the list. And also to emphasize something

25 that you've heard which is just because 94 percent of the

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1 waste is at landfills that have methane capture, doesn't

2 mean that 94 percent of the methane is being captured. So

3 it's important that that measure address increasing the

4 capture rate.

5 And in conclusion, I want to end with a phrase

6 that I'm told was popular on college campuses at a time

7 when I was still in grade school: The whole world is

8 watching.

9 CHAIRPERSON SAWYER: Thank you.

10 Mr. Haller.

11 MR. HALLER: Mr. Chair, Honorable Board members.

12 My name is Bill Haller, I'm a volunteer with the Sierra

13 Club and I serve as co-chair of Sierra Club California Air

14 Quality Committee. After my last public comment in front

15 of this Board in San Diego, I booed, grabbed and cussed at

16 and that was just by the construction industry grandmother

17 who was upset that she only made a million dollar profit.

18 Today, with any luck, I'll get through my

19 testimony. I'm here in support of your current early

20 action plan. But more so, in support of bolder action

21 now. We Californians need to lead the world. Not only in

22 our commitment and our resolve to reduce global warming,

23 but in our results.

24 With that in mind, I implore you to please,

25 please make the bigger moves now. Specifically, reduction

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1 of diesel emissions from heavy-duty trucks. Require ports

2 to provide shoreside electrification of vessels, and

3 require cement factories to use energy more efficiently.

4 If the three early action measures currently

5 being considered were a baseball team, would we have a

6 shot at the World Series? Maybe a good game of over the

7 line. But at best, we've had a pitcher, a catcher, and a

8 first baseman. And in order to put a winning team on the

9 early action field , we need some strong players, like a

10 heavy hitter, I'd take the cement industry. Someone to

11 roll in the out field, I'd take the diesel trucks. And

12 someone good around the base pads, well, that would be

13 electrified ports. And the California Chamber of

14 Commerce, well they can volunteer to sell popcorn.

15 We support your current plan. We're the fans in

16 the stadium that are cheering you on. But it is important

17 to us that you put a few superstars out on that early

18 action field.

19 Thank you.

20 CHAIRPERSON SAWYER: Thank you very much.

21 That concludes the public testimony part.

22 Ms. Witherspoon, does staff have any further comments?

23 EXECUTIVE OFFICER WITHERSPOON: Yes, we do. We

24 need to respond to this assertion over and over again that

25 we have only three early actions. We have three dozen.

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1 And I just want to repeat, for the benefit of the

2 audience and the Board, the rulemaking calendar between

3 now and 2012, starting with next month, which has the

4 off-road, heavy-duty diesel rule that you began your

5 hearing on, in May.

6 In September, we're bringing to you commercial

7 harbor craft.

8 In October, we're bringing to you architectural

9 coatings, and the 200 million on school buses, and the

10 guidelines for implementing the one billion dollars bond.

11 In November -- this is all 2007 -- we are

12 bringing to you the proposed strategy for cold ironing or

13 port electrification, which will be implemented in several

14 steps over the next year or so. The proposed regulations

15 for port drayage trucks.

16 And in December, we have an update of the zero

17 emission vehicle regulation. You heard proposals today to

18 go back to ZEVs and plug-ins and hybrids.

19 We have the proposed regulations for cleaner

20 fuels and oceangoing main vessels.

21 We have the 2020 greenhouse gas emission limit

22 and mandatory reporting. And if Laurie would bring the

23 slides up from the staff presentation starting on slide

24 19.

25 Slide 19, please.

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1 In any event, while she's looking for it, next

2 year is the on-road truck rule, which will include as many

3 of the Smart Way truck provisions as we can accomplish

4 within the sticker shock of that rule to truck owners.

5 And completion of port electrification.

6 Next slide.

7 --o0o--

8 EXECUTIVE OFFICER WITHERSPOON: Plus the three

9 discrete early action measures that we propose in Group

10 One. There's four more regulations in 2009. There's four

11 in 2010. There's two in 2011. And as this process is

12 going on, you will have decided at the end of next year,

13 what the approach shall be for the heavy industrial

14 sources, for the power plants, for the refineries, for the

15 cement plants, for oil and gas operation, and we will

16 carry those forward immediately after your decision.

17 So if the newspapers print tomorrow the Air

18 Resources Board only endorsed three measures, they will

19 have entirely mischaracterized the nature of this

20 proceeding today.

21 CHAIRPERSON SAWYER: Thank you.

22 I would like to make some observations.

23 First of all, I don't think it's lost upon any of

24 the Board members how important our action of today is, as

25 this is the first official act of this Board in

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1 implementing AB 32.

2 I'm impressed by what was brought to us today by

3 the environmental community, especially their list of 34

4 items. It, indeed, captures a richness of opportunities,

5 which I'm sure we'll be making use of many of them as we

6 move ahead in this program.

7 We heard the mention of the, of urgency and the

8 sense of urgency. This is something I share completely.

9 And I'm reminded by a story attributed to John F. Kennedy

10 when he was asking his gardener to do so -- to plant some

11 new trees in his garden and the gardener came to him and

12 said: Well, sir, you picked out an oak tree and it's

13 going to take a hundred years for it to grow into a proper

14 tree. And Kennedy's response, I think you've probably

15 heard this before, was: Do it today.

16 And that's the kind of urgency which I think we

17 need to be mindful of.

18 I am in the going to be around to see the worst

19 possible consequences of climate change. Nor am I likely

20 to be here to see the benefits of the programs which we

21 adopt today, because these are long-term measures which

22 we're getting started, it will take a long time to phase

23 them in and for them to have their effects.

24 It really is a grandchildren thing that we're

25 working on and that is certainly my motivation.

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1 I know our staff is taxed to the limit because I

2 work with them every day. I tell them every day that our

3 job is to protect the health of the people of California.

4 As number one. And they're doing a good job of that. On

5 top of that, they've taken on all the climate change

6 responsibilities.

7 And I thank you every bit. But we are a can-do

8 agency. We have a reputation for doing things. And I am

9 not afraid to ask you to do some more.

10 You know, I could pick a dozen items from the

11 list of 34 to ask you to work on today. But I'm going

12 make a symbolic gesture because I believe that symbolism

13 is important in what we do. I want to ask my Board

14 members to add a fourth item, and I want it to be the cool

15 automobile paints and I'd add glazing to that as well.

16 It's symbolic in two ways. One is, I want to honor my

17 colleague and fellow Berkeley Professor and Energy

18 Commissioner, Art Rosenfeld. This is his idea. And he is

19 the one who has brought this forward and has promoted the

20 science which makes this a sound, firm, technically

21 feasible option.

22 I also want to make a second symbolic gesture.

23 And that is to state firmly the independence of this Board

24 in meeting its responsibility to the people of California.

25 Professor Sperling.

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1 BOARD MEMBER SPERLING: Okay. I'll take that a

2 little further.

3 I do think that there are a few of these measures

4 that were just described as were going to be done any way.

5 And if we can put them, you know, identity them as early

6 action items, as clear, you know, in Category One, with

7 the understanding that they are going through a review

8 process. You know, some of these options such as, some of

9 the heavy-duty options, you know, I think we're already

10 talking about taking action on some of those in any case.

11 The actions on the port, especially the port

12 activities. And I've not been so closely engaged with

13 them, but as Tim Carmichael pointed out, there's been a

14 lot of effort put into a lot of these plans and proposals,

15 there's a lot of organizations involved. It seems like

16 there ought to be something there that we can move on

17 fairly quickly, that we can contribute to and support,

18 that our initiative's already going on, some of the short

19 power ideas.

20 And I do think that this idea of voluntary, that,

21 you know, voluntary approach. I do, you know, I guess

22 Mrs. Riordan referred to it; others have. To me, this is

23 something that all of us have to commit to. This whole

24 climate change initiative. And so I'm not sure exactly

25 what it means, I have to say, in terms of putting in

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1 place, you know, the protocol for a voluntary program, but

2 it seems like that is something that we can put in place.

3 Perhaps, we can do it with third party audits. You know,

4 there is a question about data and verification. But,

5 perhaps, if companies use third party audits to validate

6 those claims, and those can be used in the future as

7 credit towards whatever caps or other programs are put in

8 place, that would be something that can motivate and

9 action.

10 And I want this idea of this cement, I've been,

11 you know, I've, you know, it's kind of new to me. I don't

12 know the cement industry very well. But I do know it's a

13 huge source of CO2 worldwide as well as in California.

14 And if we can put together, you know, we're probably not

15 prepared to move that all the way into the first group,

16 but at least into the second group with something that we

17 would start pursuing right away, with the idea, I believe

18 this is what Tim Carmichael mentioned also, the idea that

19 these, an efficiency measure is something that is

20 compatible with whatever larger program will be created

21 later. That, in fact, as I've learned from the Low Carbon

22 Fuel Standard is, we're going to need a mixture of

23 policies. The Low Carbon Fuel Standard is a framework,

24 but there's other things it's going -- it's to be, for

25 instance, interfacing with caps on the oil refineries.

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1 There's all this discussion about oil refineries. Well,

2 you know, we're all, the Board is certainly committed to

3 putting a cap on the oil refineries. I know that's in the

4 plans. But the Low Carbon Fuel Standard interfaces with

5 that in some complicated way. And that we're going to

6 have to figure out. But it does create a performance

7 metric that we'll be integrating with some of these

8 broader caps in the future. And so the more we can put

9 some of these in place, I think the better.

10 And I do appreciate the burden on the staff.

11 What worries me, though, kind of the flip side of that,

12 is, you know, in two years, we're going to be talking

13 about, perhaps, hundreds of measures. It could be, if we

14 are not smart about -- you know, actually it'll have to be

15 less. But it could be hundreds. And if we don't get

16 start -- if we don't start a trajectory, you know, where

17 it seems perhaps difficult, you know, it's going to be

18 really difficult in the future. There's a learning

19 process for us and the staff and everyone involved.

20 So I guess, in the end, you know, there's a few

21 of those that stand out. You know, Professor Sawyer

22 mentioned with the smart paint. The paint idea. I think

23 we need to do something in the heavy-duty diesel area. I

24 think we need to do something, especially, at least

25 related to the ports. I think we should do something with

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1 voluntary program. And, perhaps, there's something, some

2 efficiency measure that can be worked into the cement

3 industry.

4 DEPUTY EXECUTIVE OFFICER SCHEIBLE: I'd like to

5 just raise a quick caution on cement. I don't -- we --

6 that's going to be one of the more difficult areas that we

7 tackle, the potential for leakage is quite severe because

8 cement can easily be imported to California.

9 The second thing is, I think the efficiency, it

10 may largely be a factor of fuel choice. But the cement

11 kilns have been designed to use the fuel that they

12 currently use. It is not just a simple switch with modest

13 cost impacts. I think it's going to be a major, major

14 issue on the industry. We're certainly going to look into

15 it thoroughly and try to figure out all the options.

16 I'd be very reluctant to advise you to move it up

17 beyond that, let's look at that as quickly as possible and

18 figure out what the options are. From what we know today,

19 they're not going -- it's not going to be an easy,

20 straight regulations.

21 BOARD MEMBER SPERLING: Yeah. It is a major

22 source, so I can -- I would defer to others. But, you

23 know, when we put things, when we decide that we're going

24 to look at items, we're not saying, I mean we're saying

25 that we are going to submit it to further scrutiny in

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1 terms of, if, if indeed this is true that there's going to

2 be this leakage and it just doesn't make sense, you know,

3 I think that's still something that we would be respectful

4 of and take into consideration.

5 EXECUTIVE OFFICER WITHERSPOON: Dr. Sperling,

6 just a quick comment, too, on voluntary measures.

7 We have recommended all the protocols you saw for

8 2005 for forestry, for digesters, for small businesses,

9 for local government, and I've forgotten a fifth, but one

10 of the things our legal staff has apprised of us of, is

11 that we cannot make any promises to anyone about how

12 voluntary credits might be considered in a future

13 regulation until that regulation is, in fact, before you

14 and designed.

15 And so, what the best we can do is help people

16 quantify their efforts and keep our mind open to how we

17 would carry those forward. But we can't give the firm

18 promises that industry is looking for. So we need to move

19 as quickly as we can into the regulations, the cap and

20 trade systems, whatever it may be, that give those actual

21 value.

22 BOARD MEMBER SPERLING: Can we say it's our

23 intent? Because we know what kind of rules, based, you

24 know, in a general sense, we're going to be adopting.

25 EXECUTIVE OFFICER WITHERSPOON: I'll ask

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1 Mr. Jenne to comment on that, because we've had many

2 internal discussions.

3 CHIEF COUNSEL JENNE: Well, we can say it's our

4 intent based on staff's current thinking. But that could

5 change; it's ultimately your decision. So we don't want

6 to send signals that this is how it's going to be and then

7 after it's, more study has taken place and you've heard

8 witnesses, you decide to do something different. So there

9 is a limit to what we feel it's appropriate to promise.

10 BOARD MEMBER SPERLING: Can you lay out just a

11 scenario where we wouldn't, I mean, given that we're

12 looking at economy-wide reductions, and if there are going

13 to be entities that start reducing greenhouse gases now,

14 it's hard for me to imagine a scenario, you know, may be

15 I'm not very creative.

16 DEPUTY EXECUTIVE OFFICER SCHEIBLE: Well, I think

17 there's two instances. We've told various groups that are

18 considering doing things that reduce their emissions, that

19 we, it's hard for us to conceive of how that would

20 adversely effect them when it actually comes time to

21 complying with regulations. That those things that

22 they've done will help them comply with future regulations

23 because their emissions are lower. We don't want to

24 process that gives allocations out based on high

25 historical emissions and somehow punishes people who have

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1 done emissions reductions. If we go to an allocation

2 process based on performance or based on auctioning, it

3 will surely be rewarded.

4 The much harder case is people come in and they

5 say, I'm going do something today and over the next three

6 years that's going to reduce emissions. I want credit

7 that carries over, that I can bank against a future

8 reductions. And that, until we design the emission, an

9 emission trading system and decide that, one, that it's

10 appropriate for incorporation in the program, and, two,

11 figure out how it works, we really can't make any sort of

12 assurance along those lines.

13 EXECUTIVE OFFICER WITHERSPOON: The other

14 difficulty is that we're crediting against business as

15 usual and that's a moving target. So the first innovator

16 might qualify for credit, but then it quickly becomes an

17 industry standard, and so we have to figure out for how

18 long credits might be viable and when it is now the new

19 operating practice across an entire industry.

20 So it's quite tricky. And we wish to be as

21 encouraging as possible. I tell everyone, go out and

22 inventory your emissions. Go out and reduce them. We're

23 going to try and use benchmarks. Good actions will be

24 rewarded. But that's as specific as staff is willing to

25 be.

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1 BOARD MEMBER SPERLING: I'll -- come back -- come

2 back to me later.

3 CHAIRPERSON SAWYER: Ms. Riordan.

4 BOARD MEMBER RIORDAN: Yes. Just some thoughts

5 that come to my head immediately.

6 One is, I'm mindful of our workload. And the

7 tasks that are before us. Because I think Ms. Witherspoon

8 characterized what probably should have been on a much

9 bigger page attached to this document that we have before

10 us, all the other things we're doing. And you went

11 through those very clearly. And I think it's very

12 important to stress what is on our table, that will be

13 before this Board in the coming year. In fact, the coming

14 six months, the table is loaded.

15 So we're doing far more than just looking at

16 three action items that are before us in this early

17 category.

18 I would caution my colleagues into moving too far

19 forward beyond the three that I see before us because I

20 think those are three major items. And I do not want to

21 raise expectations too high, that we can accomplish all

22 the other things that we would all like the do. And each

23 one of us, I'm sure, sitting here, has an item or items,

24 as I hear it, that we would like to have. But I think we

25 have to be realistic about what kind of toll it's going to

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345272

1 take on our staff and the programs that are before us,

2 before we make that next leap.

3 Now, having said that, I'm wondering if we could

4 adopt the early action items and leave open Table Two and

5 Three to come back to at some time when it's an

6 appropriate time. And I, right now, am just thinking as

7 I'm talking. Not necessarily make us a commitment of

8 moving anything forward at this point in time into that

9 early number, but maybe there's a point in time where

10 staff can come back and say, we're ready to tackle one,

11 two or three more. What, Board members, do you think we

12 should work on next? I just think this is too early in

13 the process to, perhaps, enlarge that early action item

14 area.

15 And that's just my personal viewpoint.

16 Thank you, Mr. Chairman.

17 CHAIRPERSON SAWYER: Supervisor Hill.

18 SUPERVISOR HILL: Thank you, Mr. Chair.

19 I -- after listening to the tremendous testimony

20 from the environmental community and everyone that's here,

21 and especially, I referenced it earlier, the presentation

22 on global change and global climate change and where we

23 are and where we're going, I guess there's a lot of

24 anticipation and I feel that excitement since the passage

25 of AB 32 and over this last year in looking at, and I

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345273

1 think what that anticipation is, that we're beginning a

2 process that's going to save our planet. I mean without

3 being too melodramatic.

4 But I think that's what we're doing. And that's

5 what we have to look at today.

6 And for that reason, I don't think it's

7 inappropriate for us to move rapidly to adopt more of

8 those urgent items that are necessary. I think, I

9 appreciate Dr. Sawyer's comments and his suggestion for

10 automotive paint, and I think that is a good idea. And I

11 would support that as an early action item.

12 Professor Sperling, I think you were reading my

13 notes here, and I appreciate that because you said it much

14 more eloquently than I could have said it. But I do like

15 the suggestions of his.

16 And I think the cement plant deserves the --

17 cement plant electrification, and is an important

18 consideration and one that we have to go forward with. I

19 think we're at a point where we can look at it seriously

20 and those efficiency requirements that could come from

21 moving forward with early action items.

22 I see that it's a couple years down the road, but

23 I think that we can address those at this point and move

24 forward with them. And I'd like to see that as well.

25 Certainly, the idea of the heavy-duty emission

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345274

1 reductions and the need for that, we're looking at in the

2 future, but there's no reason why, I feel, we can't bring

3 those forward as an early action item and take that step

4 and make that commitment. And if the resources aren't

5 there within staff, then we go to the Legislature and ask

6 for more to make this happen. I think that's our

7 obligation and that's our responsibility.

8 CHAIRPERSON SAWYER: Ms. D'Adamo.

9 BOARD MEMBER D'ADAMO: Well, I think I said when

10 with got started, I made some opening comments that it's

11 important that we do this right. And I think without a

12 doubt there's a lot more that could be done, but we are

13 under a legislative mandate on early action items, that

14 they meet a specific criteria, and that we meet those

15 action items within a time certain.

16 I would liken this to the SIP process. We're

17 going to take an action today and although it's not

18 federally enforceable, like in a SIP, we have a legal duty

19 to the State Legislature and a morale obligation to know

20 what we're doing before we make a commitment. And so I

21 can see both sides here. I think that we ought to go

22 further. However, I feel that in order to be responsible

23 as to what we think we can accomplish, we need to stick

24 with those three items.

25 What I would suggest is akin to, I think, where

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345275

1 Ms. Riordan was heading, that we ask staff to reevaluate

2 the list of Group Two, Group Three, go back and look at

3 the list that the environmentalists, that the

4 Environmental Justice community provided to us, and in a

5 very short order, see if there are one or two items,

6 perhaps, like the paint item, that would bubble up to the

7 top that we could either add to the list at a later time

8 or in an expedited time fashion, even if we miss that 2010

9 enforceability date.

10 So that would be my recommendation, that we stick

11 with this. We get serious about those three items. And

12 those three items alone are going to take a great deal of

13 staff's time. And I would agree with the list that

14 Ms. Witherspoon went over. It's not just these three

15 items. There's a lot of co-benefits that we're looking at

16 on this calendar that we're up against within the next two

17 years.

18 CHAIRPERSON SAWYER: Ms. Berg.

19 BOARD MEMBER BERG: Mr. Chairman, I am really

20 struggling actually over our item before us today because

21 I do feel a tremendous sense of urgency. But it's

22 interesting, I've gone through all of the written

23 communication, and out of the seven legislative people

24 that have written, members that have written us, every one

25 of them were concerned about us banning the refrigerant

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345276

1 and its impact on the lower income community. And so I

2 think that the balancing act here is critical. I think

3 that the more foundation that we can lay so that we can

4 continue to build is very important. Things like the

5 early action credit that do allow people to do things on,

6 ahead of time, are very critical.

7 I would like to also state for the record that I

8 will be abstaining from any discussion on the cool

9 automotive paint, as my company, Ellis Paint Company, does

10 make automotive refinish products. And so I would like

11 that to go onto the record, Mr. Chairman.

12 I would support the current three measures before

13 us with the understanding that we are going to work with

14 industry on the refrigerants to come up with a solution

15 other than banning, and only banning, if we feel that that

16 is ultimately our only choice.

17 And, also, I would like to encourage any work we

18 can do on early action credit. And then I also would

19 support the current regulations that we are, in front of

20 us, and how we can piggyback CO2 credit emission

21 reductions within those pending regulations. I would also

22 be in favor of that.

23 I am very troubled that we have regulations in

24 front of us that are very, very difficult. We're going to

25 be talking about some very strongly economic impacts and

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345277

1 this ramping up is going to have some cost associated that

2 I just want to make sure that as we look at this and pass

3 these things, that we understand the consequences. And I

4 am really mindful and concerned of looking good on paper

5 versus what we can get accomplished and make sure that we

6 get the reductions that we say that we can.

7 Thank you, Mr. Chairman.

8 CHAIRPERSON SAWYER: Supervisor Case.

9 BOARD MEMBER CASE: Thank you, Mr. Chairman.

10 In listening to the conversation and the

11 testimony we've heard today and the conversation among

12 colleagues, this is a big tough issue and I won't say I

13 was one of the earliest ones with agreement of global

14 warming, but maybe like a reformed smoker, I now hear the

15 concern and the level of concern for the urgency in it.

16 And I would agree with you, Mr. Chairman, I'm a bit

17 concerned. Though, I realize there are three early action

18 items that actually translate to 36 or so items, I also

19 read in the staff report that there are, maybe a couple of

20 items that are there, you're just concerned about barely

21 missing the 2010 deadline. And is there an opportunity to

22 really commit to saying, no, if we really focus, maybe

23 there's one or two more that are there.

24 Because I think sending the message that we hear

25 the urgency loud and clear, that we want to commit to the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345278

1 greatest amount of reductions at the earliest possible

2 date, that still be mindful each and every one of these is

3 very complex matter. Nothing is simple.

4 I heard the comment about cool communities. It

5 sounds simple. I won't necessarily say I believe it is

6 because I know what you deal with is very complicated.

7 And there's many different viewpoints and many different

8 ways of handling an issue. I also heard, there were a

9 couple that are already scheduled before this Board within

10 the next 12 months or so, that can have such impacts. I

11 picked out the forestry protocol, I heard in testimony.

12 The port electrification, I heard in testimony. One

13 important for the San Joaquin Valley is finding some way

14 to fund resources, infrastructure, truck stops, so trucks

15 don't idle their engine just to keep the occupant

16 comfortable. I think there are some opportunities there

17 in the San Joaquin Valley. We have such a huge trucks

18 that travel our freeways. Ninety-nine, the last I heard,

19 is running in the neighborhood of 25 to 35 percent diesel

20 trucks on that highway. And it goes right down the spine

21 of the state.

22 I don't know what these items could be. But my

23 sense, with the sense of urgency, is that we look for

24 somewhat of a broader definition. I don't know if that's

25 something that our staff could say these couple of things,

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345279

1 we think we're close to the cusp, so if we add it, it does

2 send a very different message back to the public and,

3 though, I don't agree with characterizing it as there's

4 only three out there, I think these are tremendous efforts

5 that will be done on the part of the staff and I

6 certainly, in my short tenure on this Board, have been

7 hugely impressed, both with the commitment and the

8 expertise on the part of the staff, and the commitment and

9 the expertise on the part of this Board to deal with it.

10 But I still have a sense that a stronger statement does

11 need to be made. And I'm looking for what those might be.

12 I heard the suggestions, but I think there are

13 many here in this room that know much more than I as to

14 what would be appropriate.

15 CHAIRPERSON SAWYER: Ms. Kennard.

16 BOARD MEMBER KENNARD: Thank you, Chairman

17 Sawyer.

18 Last week, I was a lone vote against the

19 San Joaquin SIP because I felt that the district, in

20 particular, not the CARB staff, had not adequately

21 addressed the community's concerns and hadn't pushed far

22 enough, hadn't raised the expectations, and we're asking

23 the community to defer in many regards some of initiatives

24 out to 2023.

25 Today, I feel very differently. I feel that the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345280

1 staff has adequately and very fully looked at all of the

2 initiatives recommended by many, many stakeholders. And

3 really worked hard to put forth those that were doable and

4 reasonable within the time frames that we have.

5 So with that, I will move the original

6 resolution.

7 CHAIRPERSON SAWYER: Do I have a second?

8 BOARD MEMBER D'ADAMO: Second.

9 CHAIRPERSON SAWYER: We may continue to discuss

10 this.

11 Dr. Gong.

12 BOARD MEMBER GONG: Just a brief comment. I've

13 listened to the discussion. I think it was quite

14 enlightening. My conclusion is I support the staff's

15 early measures.

16 But how I came to that may be another story.

17 When I first started looking at this issue, I also felt

18 that there were only three, because that's sort of what it

19 looked like in the advertisement, so this speak. But I'm

20 glad staff and Katherine Witherspoon have illuminated that

21 and I see the advantages and also what the schedule is

22 like. Which scares the heck out of me, to be honest with

23 you. That's going to be a lot of work for all of us, I

24 can see that right now.

25 I think the s wisdom of my colleagues on the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345281

1 Board is outstanding. I'm learning from them a great deal

2 about policy decision-making and policymaking. I hope

3 that perhaps the recommendations of the Environmental

4 Justice Advisory Committee will not go unheeded, but

5 certainly be looked at, and referenced to, and discussed

6 with the same Advisory Committee by staff as we go along

7 with this. I assume that that Committee will still

8 continue or is -- as we go along this pathway. So there

9 should be further discussion interaction.

10 EXECUTIVE OFFICER WITHERSPOON: Well, the

11 Environmental Justice Committee will be with us through

12 the scoping plan and through every regulation thereafter.

13 There is no sunset date on their participation.

14 BOARD MEMBER GONG: Great. Okay. So I applaud

15 that. I hope there there's more interaction. So we can

16 come to some better understanding, because, again, in the

17 beginning, it looked like three versus 34 recommendations.

18 Which, I think, in the intermediate analysis, it's not

19 true.

20 I also appreciate the statement that we should be

21 prudent in what we decide because what we decide we'll be

22 committed to. If we decide to take on too much, we may

23 actually stumble and we'll show up in the L.A. Times,

24 again. Okay?

25 And I always fall back on my own medical training

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1 and experiences. As you know, in Los Angeles County,

2 we're having a medical health care upheaval and we're

3 probably going to see a huge transition of hundreds or

4 thousands of patients from one hospital to a network of

5 hospitals. And that's scares the heck out of me as well.

6 But I know for a fact that we can only deal with several

7 patients at a time. We can't take on the whole universe

8 of patients that may be coming to our doorstep. We're

9 going to have to prudently, wisely try to triage and do

10 the best we can in terms of how to handle the situation.

11 Even though it may be life and death. A crisis. Just

12 like the planet is in today.

13 But I think we should not panic and just sort of

14 step back a little bit, make sure we know what we're

15 trying to do the best we can, as humanly possible. And I

16 think staff has put a lot of thought and effort into this.

17 They are being burdened. Hopefully, we can get more staff

18 to help share the burden. And provide more information,

19 look at these different issues that we've talked about.

20 Thank you.

21 CHAIRPERSON SAWYER: Ms. D'Adamo.

22 BOARD MEMBER D'ADAMO: I'd like to see if

23 Ms. Kennard would be willing to accept one change that I

24 think would reflect the sentiment of many Board members

25 and that is, right now, the resolution does require staff

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1 to conduct further analysis of Group Two and Group Three

2 measures. What I would suggest is that we include the

3 list provided to us by the Environmental Justice Committee

4 and that staff report back within six months, would be my

5 recommendation, but I'd be open to anything further from

6 staff on that.

7 EXECUTIVE OFFICER WITHERSPOON: That's fine.

8 We'll be happy to do that.

9 BOARD MEMBER KENNARD: And I'm certainly fine

10 with modifying my motion to that effect.

11 CHAIRPERSON SAWYER: Okay. The motion is then

12 modified as proposed by Ms. D'Adamo and accepted by

13 Ms. Kennard.

14 BOARD MEMBER CASE: Dr. Sawyer, if I might ask.

15 In the process as the AB 32 legislation requires this

16 Board to determine early discrete actions by the end of

17 this month. How does reevaluating and revisiting that, is

18 it like adding a new rule into a SIP? What's the process?

19 EXECUTIVE OFFICER WITHERSPOON: There's no

20 prohibition on adding measures. The requirement is that

21 you have a list by June 30th, and you turn that list into

22 regulations, unless for some reason, they prove not to be

23 cost-effective and technologically feasible. So what you

24 do adopt today we'll move straight in rulemaking on, but

25 you can add other measures to the list at any time.

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1 BOARD MEMBER CASE: Is there any requirement if

2 other measures are added, say, in six months, that they

3 have a timeline at which, or is it that these would have

4 to be regulatory, that get on the list today?

5 EXECUTIVE OFFICER WITHERSPOON: We would have the

6 same January 1st, 2010 enforceability date. So we'd

7 really have to hightail it.

8 BOARD MEMBER CASE: Thank you.

9 DEPUTY EXECUTIVE OFFICER SCHEIBLE: I think the

10 intent of the law with early action was to make sure that

11 we didn't not take actions while we're in the planning

12 period. So we clearly are meeting the requirements of the

13 law by identifying several measures. And it's completely

14 consistent with the law if we bring you a -- if we find

15 additional things we can bring you in that intervening

16 time, to do so. So there's no -- I don't see any legal

17 problem or intent problem.

18 CHIEF COUNSEL JENNINGS: Yeah. I would concur

19 with that. There is a provision in AB 32 which

20 specifically says that it doesn't preclude other actions

21 taken before the 2010 time frame. And whether or not

22 the -- an additional item's added to the list, the Board

23 certainly has the authority to direct staff to take the

24 actions necessary to have it adopted and enforceable by

25 January 2010.

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1 Dr. Sawyer, I don't know how close you are to

2 voting on the resolution, but there are two items, one a

3 Table Two item and one a Table Three item, that individual

4 Board members are going to recuse themselves on because of

5 potential conflicts. One of those is the cool automobile

6 paints that Ms. Berg referred to. And the other is items

7 3-4, off-road equipment, diesel equipment, including

8 airport ground equipment, ground support equipment.

9 So I would recommend that the initial vote on the

10 resolution omit those two items as being parts of Group

11 Two and Group Three, and then have individual votes on the

12 other two items, so that the people who need to recuse

13 themselves will clearly not participate on that.

14 CHAIRPERSON SAWYER: Fine. Thank you. We'll

15 follow that procedure when we vote.

16 Are there anymore comments? Supervisor Hill.

17 SUPERVISOR HILL: Question. Thank you, Doctor.

18 So what I just heard, it sounds like, if we were

19 to go forward with the cool automotive paint issue, if we

20 were to go forward with the heavy-duty emissions rule, and

21 causing that as an early action item, and if we were to go

22 forward with the cement manufacturing efficiency

23 requirements as an early action item, if they were were to

24 be found to be, during the process, if they were

25 cost-inefficient or ineffective, cost-effective, not

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345286

1 effective, or inefficient, infeasible, then we could drop

2 them?

3 EXECUTIVE OFFICER WITHERSPOON: That's correct.

4 There's a clause in your resolution that makes clear the

5 Board has this authority to delete items from the list

6 that are found not to be technologically feasible or

7 cost-effective. So you're not tying your hands

8 absolutely. You're making a presumption today that we

9 will be able to develop such measures, but if we can't,

10 they'll come off the list.

11 SUPERVISOR HILL: So would you say, if they're

12 cost-effective --

13 EXECUTIVE OFFICER WITHERSPOON: Right. Or not --

14 SUPERVISOR HILL: -- or if they're infeasible --

15 EXECUTIVE OFFICER WITHERSPOON: Right.

16 SUPERVISOR HILL: -- once it goes forward, we

17 could drop them. To me that strengthen is the argument of

18 adding these two at this point to see where they go.

19 Thank you.

20 BOARD MEMBER CASE: And Dr. Sawyer, just one

21 other request of staff. When you come back in six months,

22 could that include some response to the additional

23 recommendations -- the five recommendations from CAPCOA?

24 They presented these as fairly resource limited in terms

25 of the time of ARB staff, but potential opportunities for

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1 reductions.

2 EXECUTIVE OFFICER WITHERSPOON: I think that's a

3 great idea and it would give us time to sit down with

4 CAPCOA and talk our way through them.

5 BOARD MEMBER CASE: That would be good. Thank

6 you.

7 BOARD MEMBER BERG: Then we should also add South

8 Coast Air Quality's list as well on, that way those are

9 the two extreme non-attainment areas. So I would

10 recommend that.

11 EXECUTIVE OFFICER WITHERSPOON: Okey-dokey.

12 CHAIRPERSON SAWYER: Well, I think the point is,

13 we've heard a lot of richness of suggestions today and we

14 certainly deserve to hear back from the staff on these

15 measures that have been proposed.

16 Are we ready to vote?

17 BOARD MEMBER BERG: I just have one clarification

18 on the --

19 CHAIRPERSON SAWYER: Oh, excuse me. Of course.

20 BOARD MEMBER BERG: I want to make sure that

21 under the restriction on the high global warming potential

22 refrigerant, that we understand that you have the latitude

23 of bringing back of, we want to address those emissions,

24 but we're not saying banned unless that's what the

25 recommendation is.

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1 EXECUTIVE OFFICER WITHERSPOON: That was our

2 recommendation, and, yes, that's our understanding.

3 BOARD MEMBER BERG: Thank you very much.

4 CHAIRPERSON SAWYER: We need to take our ex parte

5 statements starting with Dr. Gong.

6 BOARD MEMBER GONG: I spoke with Joe Lyou of the

7 California Rights Alliance on June 20. Our discussion

8 reflected the recommendations of the EJ Advisory Committee

9 which was reported today by Angela. And that's all.

10 BOARD MEMBER BERG: I had two conference calls,

11 both on June 18th. One with Wendy James of a Better World

12 Group; Bonnie Holmes-Gen; Bill Magavern from Sierra Club

13 of California; Jason Barbose from Environmental

14 California; and Luke Tonachel from NRDC, and Bonnie

15 Holmes-Gen, of course, from the American Lung Association.

16 The second conference call was with the members

17 from the Environmental Justice Advocacy Committee. And

18 they included Martha Dina Arguello, the Physicians for

19 Social Responsibility, Los Angeles; Jose Carmona, Center

20 for Efficient -- Energy Efficient and Renewable

21 Technology; Philip Huang, Communities for Better

22 Environment; Angela Johnson, California Environmental

23 Rights Alliance; and Jane Williams, California Communities

24 Against Toxics.

25 BOARD MEMBER D'ADAMO: On April 25th, I met in

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345289

1 Sacramento at ARB offices with Bonnie Holmes-Gen, American

2 Lung Association; Bill Magavern, Sierra Club; Karen

3 Douglas, Environmental Defense; Erin Rogers, Union of

4 Concerned Scientists; Jason Barbose, Environmental

5 California; and Wendy James, Better World Group.

6 On June 18th, I participated in a conference call

7 with members of the Environmental Justice Advisory

8 Committee, Jose Carmona, Center for Energy Efficiency and

9 Renewable Technology; Angela Johnson-Meszaros, California

10 Environmental Rights Alliance; Jane Williams, California

11 Communities Against Toxics.

12 On June 18th, I spoke over the telephone with

13 Joshua Stark, National Parks Conservation Association.

14 And then today I had a brief discussion with the

15 Roland Huang with the NRDC.

16 All OF those discussions mirrored the testimony

17 that the individuals provided today.

18 SUPERVISOR HILL: Mr. Chair, on May 1st, there

19 was a meeting in my Redwood City office and a conference

20 call at the same time with Derva Wang, NRDC; Linda Weiner,

21 American Lung Association; Bill Magavern, Sierra Club;

22 Wendy James; Dan Calb, Union of Concerned Scientists; and

23 Jason Barbose.

24 And their testimony today referenced and mirrored

25 they comments on that meeting.

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1 June 13, call with Western States Petroleum

2 Association, Cathy Reheis-Boyd and Gina Grey.

3 On June 19th, conference call with members of the

4 Environmental Justice Advisory Committee. Participants

5 were Jose Carmona, Center for Energy Efficiency and

6 Renewable technology; Angela Johnson-Meszaros, California

7 Environmental Rights Alliance; Jane Williams, California

8 Communities Against Toxics; and Philip Huang, Communities

9 for a Better Environment. And their discussion and

10 conversation were related to the testimony today.

11 BOARD MEMBER KENNARD: I have no ex parte

12 communications.

13 CHAIRPERSON SAWYER: On the 7th of June, I met

14 with Bonnie Holmes-Gen of the American Lung Association;

15 Karen Douglas of Environmental Defense; Scott Smithline,

16 Californians Against Waste; Diane Bailey, Natural

17 Resources Defense Council; Don Anair, Union of Concerned

18 Scientists.

19 And the in the same discussion by phone with

20 Wendy James of the Global Warming Action Coalition and

21 Deborah Wong of the Natural Resources Defense Council.

22 And what they testified to today was similar to

23 what we discussed.

24 On the 12th of June, I met with Bill Magavern of

25 the Sierra Club of California, and what we discussed

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345291

1 reflected what he said here today.

2 BOARD MEMBER RIORDAN: I received a call on

3 June 11th from Cathy Reheis-Boyd and Gina Grey of Western

4 States Petroleum Association. That conversation mirrored

5 Cathy Reheis-Boyd's testimony today.

6 I received a call on June 21st Fred Aguirre

7 expressing concern about the cool automotive paint item.

8 Those are all that I've received.

9 BOARD MEMBER CASE: I have none.

10 BOARD MEMBER SPERLING: On May 14th, I met in

11 Davis, actually some were on the phone call, some were

12 present. Bonnie Holmes-Gen from American Lung; Karen

13 Douglas, Environmental Defense; Jamie Knapp; Luke

14 Tonachel, NRDC; Kate Hoerner, Danielle Fugere, Bluewater;

15 Patricia Monahan, USC; Jason Barbose, Environment

16 California; John Shears, CEERT; Wendy James, Better World

17 Group.

18 May 30th, had a conference call with

19 representatives from Sempra on a project and an initiative

20 to exam opportunities to integrate energy efficiency into

21 AB 32. And we just only generally discussed the early

22 action items.

23 June 5th, telephone call with K. C. Bishop of

24 Chevron.

25 June 8th, call with the Western States Petroleum

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345292

1 Association with Cathy Reheis-Boyd; David Ligh, Exxon

2 Mobil; Jim Uihlein, Chevron; Elroy Garcia, KP Advocates;

3 and Scott Folwarkow from Valero.

4 June 13th, a conference call with Wendy James;

5 Bonnie Holmes-Gen, American Lung; Derva Wang, NRDC; Tom

6 O'Connor, Environmental Defense.

7 And then June 19th, a conference call with the

8 Environmental Justice Advisory Committee, Jose Carmona,

9 Philip Huang, Angela Johnson-Meszaros, and Jane Williams.

10 CHAIRPERSON SAWYER: Okay. Are we ready to vote?

11 CHIEF COUNSEL JENNINGS: Chairman Sawyer, would

12 it be useful for me to just summarize?

13 CHAIRPERSON SAWYER: Yeah, remind us what we're

14 voting on the first time, because that'll be the main

15 motion.

16 CHIEF COUNSEL JENNINGS: Okay. You're going to

17 be voting on the resolution, as proposed, with the change

18 of directing the staff to report to the Board within

19 six months with a fuller evaluation of the recommendations

20 made by the Environmental Justice Committee, made by

21 CAPCOA, and made by the South Coast District.

22 Also you are going to not be voting at this time

23 on inclusion of cool paints on Group Two and the off-road

24 diesel equipment in Group Three. You're going to vote on

25 those separately afterwards.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345293

1 CHAIRPERSON SAWYER: Would the clerk please call

2 the roll.

3 SECRETARY ANDREONI: Ms. Berg?

4 BOARD MEMBER BERG: Aye.

5 SECRETARY ANDREONI: Supervisor Case?

6 BOARD MEMBER CASE: Aye.

7 SECRETARY ANDREONI: Ms. D'Adamo?

8 BOARD MEMBER D'ADAMO: Aye.

9 SECRETARY ANDREONI: Dr. Gong?

10 BOARD MEMBER GONG: Aye.

11 SECRETARY ANDREONI: Supervisor Hill?

12 SUPERVISOR HILL: No.

13 SECRETARY ANDREONI: Ms. Kennard?

14 BOARD MEMBER KENNARD: Aye.

15 SECRETARY ANDREONI: Ms. Riordan?

16 BOARD MEMBER RIORDAN: Aye.

17 SECRETARY ANDREONI: Professor Sperling?

18 BOARD MEMBER SPERLING: No.

19 SECRETARY ANDREONI: Chairman Sawyer?

20 CHAIRPERSON SAWYER: No.

21 SECRETARY ANDREONI: Motion passes six to three.

22 CHAIRPERSON SAWYER: And now we need to clean up

23 those other two issues?

24 CHIEF COUNSEL JENNINGS: Yes. I suggest, now you

25 should have a vote on whether the cool automotive paints

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345294

1 item, 2-15, should be included in Group Two.

2 And my understanding is Ms. Berg is going to

3 recuse herself from that vote.

4 CHAIRPERSON SAWYER: Would the clerk please call

5 the roll.

6 SECRETARY ANDREONI: Supervisor Case?

7 BOARD MEMBER CASE: Aye.

8 SECRETARY ANDREONI: Ms. D'Adamo?

9 BOARD MEMBER D'ADAMO: Aye.

10 SECRETARY ANDREONI: Dr. Gong?

11 BOARD MEMBER GONG: Aye.

12 SECRETARY ANDREONI: Supervisor Hill?

13 SUPERVISOR HILL: No.

14 SECRETARY ANDREONI: Ms. Kennard?

15 BOARD MEMBER KENNARD: Aye.

16 SECRETARY ANDREONI: Ms. Riordan?

17 BOARD MEMBER RIORDAN: Aye.

18 SECRETARY ANDREONI: Professor Sperling?

19 BOARD MEMBER SPERLING: Aye.

20 SECRETARY ANDREONI: Chairman Sawyer?

21 CHAIRPERSON SAWYER: Aye.

22 SECRETARY ANDREONI: Motion passes seven to one.

23 CHAIRPERSON SAWYER: And once again --

24 CHIEF COUNSEL JENNINGS: Yes. The final vote

25 will be whether item 3-4, off-road diesel equipment,

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345295

1 should be added to the Group Three. And on this item I

2 understand that Ms. Kennard is going to recuse herself

3 from the vote.

4 CHAIRPERSON SAWYER: Would the clerk please call

5 the roll.

6 SECRETARY ANDREONI: Ms. Berg?

7 BOARD MEMBER BERG: Aye.

8 SECRETARY ANDREONI: Supervisor Case?

9 BOARD MEMBER CASE: Aye.

10 SECRETARY ANDREONI: Ms. D'Adamo?

11 BOARD MEMBER D'ADAMO: Aye.

12 SECRETARY ANDREONI: Dr. Gong?

13 BOARD MEMBER GONG: Aye.

14 SECRETARY ANDREONI: Supervisor Hill?

15 SUPERVISOR HILL: No.

16 SECRETARY ANDREONI: Excuse me.

17 SUPERVISOR HILL: No.

18 SECRETARY ANDREONI: Ms. Riordan?

19 BOARD MEMBER RIORDAN: Aye.

20 SECRETARY ANDREONI: Professor Sperling?

21 BOARD MEMBER SPERLING: Aye.

22 SECRETARY ANDREONI: Chairman Sawyer?

23 CHAIRPERSON SAWYER: Aye.

24 SECRETARY ANDREONI: Motion passes seven to one.

25 CHAIRPERSON SAWYER: Fine. Thank you very much.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345296

1 I want to thank everybody who was here today to testify.

2 We're going to be working with you on these issues over

3 the next years. And we certainly appreciate your support.

4 We will take a ten-minute break at this time and

5 our intention is to deal with the next two items on the

6 Board agenda today.

7 (Thereupon, a recess was taken.)

8 CHAIRPERSON SAWYER: Agenda Item 7-7-5, a

9 Consideration of Proposed Amendments to the Emission

10 Control and Smog Index Label Regulations for Motor

11 Vehicles.

12 The Air Resources Board has required air

13 pollution labels on new cars since 1998. New law requires

14 the Air Resources Board to add a global warming index as

15 well.

16 Ms. Witherspoon, please introduce this item.

17 EXECUTIVE OFFICER WITHERSPOON: Thank you,

18 Dr. Sawyer.

19 California citizens purchase approximately two

20 million new vehicles a year. ARB requires smog index

21 labels to help consumers find the most environmentally

22 beneficial products. Last year, the Legislature directed

23 that we begin labeling cars for greenhouse gas emissions

24 as well. Focus groups and market research indicate that

25 many consumers do not fully understand the environmental

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345297

1 characteristics of new cars. The same studies indicate

2 that California's current labels should be improved for

3 readability and consistency. The proposed rule adds a

4 greenhouse gas index to new vehicle labels and enhance the

5 label's appearance and usefulness overall.

6 For both smog and global warming, staff is

7 proposing a simple scale from one to ten, where one

8 represents the dirtiest vehicle and ten is the cleanest.

9 Craig Duehring of the Mobile Source Control Division will

10 make the staff presentation.

11 Craig.

12 (Thereupon an overhead presentation was

13 presented as follows.)

14 AIR RESOURCES ENGINEER DUEHRING: Thank you,

15 Ms. Witherspoon, and good afternoon, Chairman Sawyer,

16 members of the Board. Ladies and gentlemen.

17 Do we have the presentation available.

18 We are here today to discuss staff's proposed

19 amendments to the Smog Index Label regulations that would

20 modify the current label's appearance and add a global

21 warming index. These proposed regulatory actions are

22 presented today as a result of California statute adopted

23 pursuant the Assembly Bill 1229.

24 --o0o--

25 AIR RESOURCES ENGINEER DUEHRING: I begin with a

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345298

1 brief overview of the materials being presented. First, I

2 will provide a summary of the Assembly Bill, then discuss

3 the current Smog Index Label regulations and show the

4 Board actual samples found on vehicles today. I will next

5 present the proposed new Environmental Performance Label

6 which modifies the content and appearance of the current

7 Smog Index Label and adds a global warming index.

8 Additionally, I will discuss the economic impacts and

9 outstanding issues surrounding adoption and implementation

10 of these regulations. And will end with a brief summary

11 and recommendation.

12 --o0o--

13 AIR RESOURCES ENGINEER DUEHRING: On October 6th,

14 2005, Assembly Bill 1229 was signed into law, directing

15 the Air Resources Board to review and revise the existing

16 Smog Index and to add a global warming index by July 1,

17 2007.

18 Specifically, the bill requires the label to be

19 in effect for 2009 and subsequent model year new motor

20 vehicles. And just like the current Smog Index, is

21 required for all passenger cars and light-duty trucks with

22 a gross vehicle weight of up to 8500 pounds. In addition,

23 this bill adds medium-duty passenger vehicles less than

24 10,000 pounds to labeling requirements.

25 The bill also requires to label to include

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345299

1 projected lowest and average vehicle emission reference

2 points, use at least one color ink in addition to black,

3 and provide a brief explanation of the indices. The label

4 must include a statement that identifies the use of motor

5 vehicles as a primary cause of global warming and how

6 emissions from motor vehicles may be reduced. And

7 finally, the global warming index must account for

8 upstream emissions.

9 --o0o--

10 AIR RESOURCES ENGINEER DUEHRING: The current

11 Smog Index Label has been required on new vehicles sold in

12 California since the 1998 model year. In addition to

13 California, this label is appearing on new vehicles sold

14 in other states that have adopted California's

15 certification standards.

16 The label provides customers -- the label

17 provides consumers with an indication of a new light-duty

18 vehicle's relative contribution to smog formation based on

19 exhaust non-methane organic gas, NMOG, oxides of nitrogen,

20 NOx, and evaporative hydrocarbon, HC, emissions. The

21 current Smog Index uses a relative ratio to compare the

22 vehicle being labeled to a base vehicle as determined by

23 the Air Board. This Smog Index ratio is then displayed

24 graphically on a label, usually as a number less than one,

25 along with the Smog Index ratio of an average new vehicle

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345300

1 for the same model year as the vehicle being sold.

2 This slide shows a sample Smog Index Label as

3 originally recommended by the ARB. Existing regulations,

4 however, have allowed the manufacturers to vary the size

5 and graphical representation of the Smog Index. Some

6 vehicle manufacturers have even incorporated the Smog

7 Index information into the new vehicle's Monroney sticker

8 that includes the vehicle's features, pricing, U.S. EPA

9 fuel economy, and other information. Today, many vehicle

10 manufacturers have their own graphical representation of

11 the scale, some similar to the one shown, some showing two

12 scales, and some extending the length of the scale to span

13 from zero to three. As the length of the scale increases,

14 the ability to differentiate smog indices tends to

15 diminish.

16 --o0o--

17 AIR RESOURCES ENGINEER DUEHRING: The next two

18 slides contain some pictures of actual 2007 Smog Index

19 Labels in use today. Today's Smog Index Labels show

20 inconsistent label design and presentation by auto

21 manufacturers. As you can see, manufacturers have

22 developed unique graphical presentations of the smog

23 emissions information. The two labels in this slide are

24 actually displaying the same information. In this case,

25 the Smog Index of both vehicles is .39, yet the consumer

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345301

1 seize two different presentation.

2 --o0o--

3 AIR RESOURCES ENGINEER DUEHRING: In this slide,

4 the two labels again use a unique presentation to display

5 similar smog emissions information. The top label

6 displays a Smog Index value of .5 on a scale from one to

7 two and the bottom label displays a Smog Index value of

8 .49 on a scale from one to three. The emissions from the

9 two vehicles are nearly the same. However, the value of

10 on an extended scale can easily be interpreted as being

11 significantly cleaner. The many variations of labels from

12 one manufacturer to the next make it harder for the

13 customer to compare vehicles. For these reasons, staff

14 proposes prescriptive label requirements to standardize

15 content and presentation of the label.

16 --o0o--

17 AIR RESOURCES ENGINEER DUEHRING: Staff is

18 proposing to modify the graphics and content of the Smog

19 Index Label to increase customer awareness and

20 understanding. Staff proposes using a simple scale of one

21 to ten where one represents the dirtiest vehicle available

22 and ten, the cleanest. This is opposite of the current

23 scale, where zero is the cleanest. Staff proposes using

24 this new scale for two reasons. First, consumer focus

25 group research indicates more consumers understand ten is

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345302

1 well performing and one is poor performing. Second, the

2 U.S. EPA has a popular website that uses simple one to ten

3 scales for both air pollution and greenhouse gas ratings

4 of new vehicles where one represents the worst and ten the

5 best.

6 Staff also proposes adding a Global Warming Index

7 to the label using a similar one to ten scoring system.

8 This scoring system will assign scores based on the

9 greenhouse gas certifications required under the motor

10 vehicle greenhouse gas regulation, contained in section

11 1961.1, Title 13, of the California Code of Regulations,

12 better known as the Pavely Bill, set to take effect for

13 the 2009 model year.

14 --o0o--

15 AIR RESOURCES ENGINEER DUEHRING: Staff also

16 proposes prescriptive regulations for the new label to

17 establish presentation consistency from one manufacturer

18 to the next. These proposed regulations require the use

19 of a consistent green border and a six by four inch label

20 size to aid in consumer recognition. In addition, the

21 label informs the consumer of how a specific vehicle

22 compares to the average and the cleanest available on the

23 market.

24 Due to lead time requirements for manufacturers

25 to implement the new regulations, staff recommends

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345303

1 establishing an effective start date of October 1, 2008.

2 Staff also recommends allowing manufacturers to install

3 the new label prior to October 1, 2008, if the

4 manufacturer so chooses.

5 --o0o--

6 AIR RESOURCES ENGINEER DUEHRING: This slide

7 shows a picture of a proposed Environmental Performance

8 Label. It identifies a vehicle's global warming score on

9 the left and the smog score on the right. As you can see,

10 these scales establish a relationship between a specific

11 vehicle, the average vehicle, and the cleanest vehicle.

12 The label presentation is the result of prior U.S. EPA

13 market research and recent California focus group studies

14 using to aid with label design and foster understanding.

15 Some of the key findings of the focus groups

16 highlighted label size, label color, and scale

17 presentation. Consumers preferred the proposed minimum

18 label size of six inches wide by four inches tall and

19 mentioned that smaller labels may not get noticed and

20 therefore may not get read. Consumers liked the green

21 border of the proposed emissions label. They felt green

22 represents the environment, conservation, and they felt

23 green catches the eye. And consumers preferred solid

24 black blocks to either a solid black bar or a gradient

25 over the the entire scale. The blocks were more

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345304

1 definitive and gave another counting mechanism.

2 Staff used this information from these focus

3 groups and other stakeholder input to develop the proposed

4 design you see today. The new label also encourages the

5 consumer to visit theCalifornia Drive Clean website in

6 order to obtain more information.

7 --o0o--

8 AIR RESOURCES ENGINEER DUEHRING: Staff is

9 proposing a Smog Index scoring system that is based on

10 emissions certification levels from both the California

11 LEV II and the U.S. EPA regulations. Doing so will allow

12 for a scoring system that could be used by both ARB and

13 U.S. EPA. This table shows the California and Federal

14 emissions certification levels that will apply to the

15 affected 2009 model year vehicles.

16 As seen in this table, these certification levels

17 line up quite nicely and are listed here by the California

18 terminology and by the federal "bin levels." In addition,

19 this table identifies the tailpipe emission standard for

20 NMOG and NOx and the proposed smog score. While the

21 Partial Zero emission vehicle or PZEV, the Super Ultra Low

22 Emission Vehicle or SULEV, and the Federal Bin 2 vehicles

23 are certified to the same exhaust emission standard, PZEV

24 certified vehicles receive a higher score due to their

25 zero evaporative emissions and extended 150,000 mile

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345305

1 emission warranty. Therefore, the PZEV certification

2 level was assigned a score of nine and the SULEV and Bin 2

3 certification was assigned a score of eight.

4 This smog scoring system represents all vehicles

5 from the dirtiest to the cleanest. Vehicles with the

6 score of one, two or three are typically medium-duty

7 passenger vehicles such as large sport utilities or eight

8 to 12 passenger vans. Vehicles with a score of ten

9 represents zero emission vehicles such as Battery Electric

10 or Fuel Cell Vehicles. All remaining passenger cars and

11 light-duty trucks will receive a score from four to nine

12 based on their certification level. The table also

13 includes some typical vehicles that currently certify to

14 these levels.

15 For vehicles capable of operating on more than

16 one fuel, the scores displayed on the label will be based

17 on only the highest emitting fuel. The label will direct

18 consumers to visit ARB's Drive Clean website to find

19 information on alternative fuel vehicles and the potential

20 environmental improvements of using alternative fuels.

21 --o0o--

22 AIR RESOURCES ENGINEER DUEHRING: Staff is

23 proposing a Global Warming Index that is based on

24 emissions certification data from ARB's Motor Vehicle

25 Greenhouse Gas regulation. This regulation establishes a

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345306

1 carbon dioxide or CO2 equivalent value that uses three

2 greenhouse gases, carbon dioxide, nitrous oxide, and

3 methane, based on their relative contribution to global

4 warming. It also includes credits for indirect and direct

5 use of air conditioning systems and adjusts for upstream

6 emissions.

7 Staff performed a statistical analysis on the CO2

8 data available from the model year 2007 California

9 certifications. The statistical average of 360 grams per

10 mile CO2 set at five on the scale. Because there are no

11 certification bins from which a global warming scoring

12 system could be determined, staff used a statistical

13 analysis to develop a scoring system based on a normal

14 distribution of scores.

15 --o0o--

16 AIR RESOURCES ENGINEER DUEHRING: This table

17 shows the scoring criteria based on the CO2 equivalent

18 criteria values -- this table shows the scoring criteria

19 based on the CO2 equivalent certification values and a

20 list of typical vehicles those values would represent.

21 Vehicles with a score of one represent the large, larger

22 medium-duty passenger vehicles, such as Ford' E-25-

23 Econoline and Expedition. Vehicles with a score of ten

24 are typically hybrid passenger vehicles, such as the

25 Toyota Prius and the Honda Civic Hybrid. Average vehicles

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345307

1 obtaining a score of five are typically mid-to-large size

2 passenger cars and small light-duty trucks, such as the

3 Ford Mustang and Crown Victoria, Toyota Four Runner, and

4 Honda Odyssey van.

5 --o0o--

6 AIR RESOURCES ENGINEER DUEHRING: ARB's Motor

7 Vehicle Greenhouse Gas regulation requires vehicle

8 manufacturers to decrease the fleet average CO2 equivalent

9 emissions incrementally from 2009 to 2016 after which the

10 fleet average CO2 equivalent emissions remains constant.

11 Staff looked these incremental adjustments and

12 determined that by the 2012 model year, vehicles will have

13 reduced their emissions by 20 percent over 2009 levels.

14 This scenario is similar to what's known in academia as

15 grade creep where over time the distribution of grades

16 range only from A to C in lieu of A to F. Because of

17 this, the average score of five must be adjusted

18 periodically. This would also be an appropriate time to

19 evaluate the need for modifying the indices or label

20 provisions to reflect potentially increasing use of

21 alternative fuels in California.

22 For these reasons, staff will monitor the vehicle

23 certification distribution and will return to the Board

24 periodically with recommended adjustments.

25 --o0o--

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345308

1 AIR RESOURCES ENGINEER DUEHRING: There are two

2 economic considerations from these proposed regulatory

3 amendments. First is the cost of increasing the label

4 size and the second is the cost of producing larger labels

5 -- excuse me -- producing color labels. Staff found these

6 costs to be minor.

7 Staff looked at the environmental benefits of

8 this regulation and expects that the proposed label will

9 affect the purchasing choices of some vehicle buyers;

10 however, the degree to which this occurs is not known.

11 Over time, staff expects that increased awareness of the

12 benefits of purchasing a vehicle with low global warming

13 and smog emissions will result in market pressure to

14 increase the number of models available with low

15 emissions. The increased consumer awareness of vehicle

16 emissions may also encourage the purchase of other green

17 products.

18 --o0o--

19 AIR RESOURCES ENGINEER DUEHRING: The following

20 is a review of the outstanding issue raised by various

21 stakeholders.

22 First, some vehicle manufacturers stressed

23 concern with the lead time required to implement new label

24 improvements. They indicated it would not be possible to

25 produce a new -- it would not be possible to produce new

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345309

1 labels for all 2009 model year vehicles as required by

2 statute. Staff solicited feedback from the vehicle

3 manufacturers on lead time constraints for producing new

4 labels. Staff reviewed this feedback and recommends an

5 implementation start date of October 1, 2008 to balance

6 lead time issues and statutory requirements.

7 The second concern is that increasing the label

8 size of the label from what they currently produce, which

9 is on average a two and a half by four and a half inch

10 label to the proposed four by six inch label may, one,

11 impact the placement of the label, and, two, create

12 visibility problems for consumers wanting to test drive

13 the vehicle.

14 Some vehicle manufacturers use a separate Smog

15 Index Label for placement flexibility, while others

16 combine the Smog Index with other labels including the new

17 vehicle Monroney sticker which includes the vehicle's

18 features, pricing, fuel economy, and other information.

19 By placing the California Smog Index information

20 onto the federally mandated Monroney sticker,

21 manufacturers indicate the Smog Index is now appearing in

22 all 50 states. Unfortunately, the Monroney sticker

23 already contains a tremendous amount of consumer

24 information and space is limited.

25 To evaluate this issue, staff presented samples

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345310

1 of various sized labels to consumer focus groups held in

2 March of 2007. These focus groups preferred the label

3 size of four by six inches and did not recommend reducing

4 the label size in order to place the label on the Monroney

5 sticker. Staff concluded that maintaining a consistent

6 look at a minimum label size of four by six inches is

7 required for consumer awareness and readability.

8 The second issue related to increasing the label

9 size is the potential to obstruct vision during consumer

10 test drives. The concern is focused on vehicles without

11 rear side windows such as two-seater sports cars and

12 convertibles. Some vehicle manufacturers requested staff

13 allow the use of smaller labels on such vehicles. Staff

14 does not recommend reducing the size of the label in such

15 cases because placement of the label is not restricted to

16 side windows only. Like the current Smog Index Label, the

17 proposed four by six inch label, which is expanding by

18 only an inch or two over the existing label, may also be

19 placed on the windshield if there is no space available on

20 the side windows. Staff determined there is sufficient

21 side window and/or front windshield area to place the

22 label without interfering with the driver's view.

23 The final concern is that in 2009, California and

24 U.S. EPA scores may not be harmonized. Currently, the

25 U.S. EPA does not require an emissions label to be placed

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345311

1 on each vehicle at the point of sale. The California

2 label will be the only required label displaying emission

3 scores; therefore, label harmonization is not critical.

4 The only place of potential non-conformity is with the

5 U.S. EPA website and the California label. This was

6 avoidable because the U.S. EPA uses fuel economy data to

7 score vehicles and ARB use three greenhouse gases and

8 provides adjustments for air conditioners and upstream

9 emissions to score vehicles. California also has a unique

10 PZEV smog certification level creating the need for a

11 special California smog scale that varies slightly from

12 the Federal scale. These scoring differences are

13 projected to be minor and staff continues to work with the

14 U.S. EPA in hopes to ultimately harmonize on one scoring

15 methodology.

16 --o0o--

17 AIR RESOURCES ENGINEER DUEHRING: In response to

18 comments, some of which may be reiterated here today,

19 staff has made changes to the initial proposal. Those

20 changes are included in the proposed resolution with

21 15-day modification. The changes include minor formatting

22 and text modification, adding a dimensional tolerance to

23 the graphics, and clarification of the work truck

24 exemption from the global warming score.

25 --o0o--

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345312

1 AIR RESOURCES ENGINEER DUEHRING: In summary,

2 staff is proposing three simple amendments. They are.

3 1. Revise the existing Smog Index in both

4 content and presentation;

5 2. Add a Global Warming Index to the label and

6 present both indices using simple one to ten scales; and

7 3. Adopt a consistent labeling format for

8 consumer awareness and understanding.

9 In conclusion, staff recommends that you consider

10 adopting staff's proposal as presented today.

11 This concludes staff's presentation.

12 CHAIRPERSON SAWYER: Thank you.

13 Madam Ombudsman, please describe the public

14 participation that occurred while this item was being

15 developed and report any concerns or comments you may have

16 to the Board.

17 OMBUDSMAN QUETIN: Dr. Sawyer and members of the

18 Board. This proposed regulation has been developed with

19 input from the representatives of the Alliance of

20 Automobile Manufacturers, Environment and Energy

21 Association of International Automobile Manufacturers,

22 Natural Resources Defense Council, Union of Concerned

23 Scientists, and the U.S. EPA. Staff began their efforts

24 to develop this rule in November 2006. They held two

25 workshops in Sacramento on February 15th and February

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345313

1 16th, 2007, with an average have 10 to 15 people attending

2 each. Staff also held ten industry and environmental

3 meetings and approximately 50 telephone conversations with

4 stakeholders. The staff report was released for public

5 comment on May 1st, 2007 and was noticed on the ARB

6 website. An Internet message was sent to the 7,760

7 subscribers to the list serves for this item. The notice

8 for the Board hearing was posted a few days later, on

9 May 4th, 2007.

10 As mentioned by staff, issues remain with

11 automakers, including, but not limited to, a desire for a

12 longer lead time for implementation, and also they request

13 that the label be smaller.

14 That concludes my comments.

15 Thank you.

16 CHAIRPERSON SAWYER: Thank you very much.

17 Let me comment on a couple of things. One is the

18 difference with the EPA reporting is unfortunate, but,

19 clearly, we need to work with EPA to adopt our approach,

20 which is clearly the scientifically correct one.

21 And also, I am particularly sensitive to grade

22 creep. But, I think the, you know, I should live to see

23 the day when the lowest grade of a car is eight and I

24 think we should all be working toward that end.

25 Do Board members have any questions?

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345314

1 Ms. D'Adamo.

2 BOARD MEMBER D'ADAMO: I think this is terrific.

3 So I compliment the staff. Just wondering about our

4 website. Will this information be posted on the website?

5 I see heads nodding. What about a comprehensive chart

6 that has, so if I -- let's say I don't know what kind of

7 car I want, but I know I want nine or above. Can I look

8 up nine and see the entire list on the website.

9 SUSTAINABLE TRANSPORTATION TECHNOLOGY BRANCH

10 CHIEF BEVAN: We're still in the process of developing

11 exactly what that information would look like. I think

12 that's an excellent idea.

13 BOARD MEMBER D'ADAMO: Okay.

14 CHAIRPERSON SAWYER: Dr. Gong.

15 BOARD MEMBER GONG: We discussed this in a

16 briefing, but I was wondering about used car. Say, in the

17 year 2010. If I want to find out what my ratings were on

18 a possible car I wanted to buy that was used, would there

19 be such information, would this tag follow the car or it

20 would be lost forever after it's sold?

21 SUSTAINABLE TRANSPORTATION TECHNOLOGY BRANCH

22 CHIEF BEVAN: The website could have information for model

23 year 2009 and beyond. For cars that are older than that,

24 we can have information on the site that can help them

25 translate because CARB, at least for the Smog Index score,

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345315

1 especially, a ULEV, a SULEV, translate that to a specific,

2 you know, to the number score. So we can help them with

3 that. And access to what the vehicle, like a, let's say a

4 Honda Accord from the year 2000, I believe we do list

5 those used vehicle certification standards on our website

6 already.

7 BOARD MEMBER GONG: So a consumer can just look

8 at the website, ARB website, and find that information,

9 perhaps. Okay,

10 CHAIRPERSON SAWYER: The first three witnesses

11 signed up to speak are Steven Douglas, Kristin Kenausis,

12 and Dave Raney.

13 Mr. Douglas.

14 MR. DOUGLAS: Thank you, Dr. Sawyer and members

15 of the Board. I'm Steven Douglas, the Director of

16 Environmental Affairs for the Alliance of Automobile

17 Manufacturers.

18 And first, I'd like to thank the staff. They've

19 worked very hard, we've worked very closely with them.

20 And we've resolved most of the issues that we have. So

21 I'll just touch on two of those which have been

22 highlighted already. Those being lead time and label

23 size.

24 For the lead time, we do appreciate the staff has

25 provided us to October the 1st of 2008. That gives us

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345316

1 time to test out labels on 2009 model year cars. And,

2 however, we've, we still recommend an additional three

3 months to January the 1st to allow for a smoother and more

4 cost-effective implementation. So that is our

5 recommendation on lead time.

6 For label size, we believe that, as has been

7 pointed out, that the label is too large, that a four by

8 six is too large, and the concern is the visibility when

9 doing test drives. There is a number of federal and state

10 requirements and the number of different labels that

11 manufacturers must put on the vehicle and that does reduce

12 visibility. We've recommended a three by five inch size.

13 However, we could also support Honda's recommendation. I

14 looked at their comments and it was two and a half by four

15 and a half inches.

16 If this was either allowed or if it was mandated

17 for both -- if the label is placed on the Monroney label

18 or if it's a separate label, and we base this

19 recommendation of consistency for three reasons.

20 First, it would provide consistency in both the

21 content of the label as well as the size, but regardless

22 of where it's placed.

23 Second, we believe that a separate label is as

24 visible, if not more so, than one that's incorporated into

25 an existing Monroney label.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345317

1 And finally, if visibility is concern, and we

2 certainly believe it is, then it would make little sense

3 to -- to -- for a separate label to require a larger one

4 than one that's incorporated in the Monroney label.

5 So that concludes my comments. We -- again, we

6 appreciate the staff's work on this. And just to

7 summarize, we ask for an additional three months of lead

8 time. And we ask for a consistent label size and that

9 label size being smaller, either three by five or, as

10 Honda recommends, 2.5 by 4.5.

11 Thank you.

12 CHAIRPERSON SAWYER: I have a question about the

13 Monroney label. And its size. Is that determined by the

14 number of accessories that the vehicles come with or is

15 there fixed size?

16 MR. DOUGLAS: You know, I think that would have

17 to be answered by some of the manufacturers. I know,

18 obviously, the more accessories and the more options they

19 have, the fuller it gets. So if you have a Monroney

20 label, or vehicle with a lot of options, you don't have a

21 lost extra space to put a label on. But I'd turn that one

22 over to, perhaps, Honda.

23 CHAIRPERSON SAWYER: And am I correct that those

24 are always placed on the driver's side in the rear window

25 or are they sometimes on the driver's side driver window?

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345318

1 MR. DOUGLAS: As far as I know, they're always

2 placed in the rear window. But that's an option. It

3 varies by vehicle.

4 CHAIRPERSON SAWYER: And if it has a small rear

5 window, the label has to be smaller to fit in it, is that

6 how it's accommodated?

7 MR. DOUGLAS: You know, again, I'd have to turn

8 that to the manufacturers to look at that.

9 CHAIRPERSON SAWYER: Okay. Well, maybe we'll get

10 an answer to that from some of the other following

11 speakers.

12 Are there any other questions.

13 Dr. Gong.

14 BOARD MEMBER GONG: Who's Monroney? Please.

15 MR. DOUGLAS: Monroney actually was a U.S.

16 legislator and he, I think it was the Monroney Act back in

17 the '40's or '50's, there was no, there was regulation at

18 the dealership on pricing or features on the vehicles. So

19 they were selling vehicles at tremendous profits. So he

20 came up with an act to say, okay, all labels have to have

21 a manufacturer's suggested retail price.

22 CHAIRPERSON SAWYER: These are put on at the

23 assembly line?

24 MR. DOUGLAS: They're put on by the manufacturers

25 after the vehicle is assembled prior to shipment.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345319

1 CHAIRPERSON SAWYER: We're all learning

2 something. Thank you very much.

3 Ms. Kenausis.

4 MS. KENAUSIS: Thank you, Dr. Sawyer and the

5 Board. My name is Kristin Kenausis. I work for the U.S.

6 Environment Protection Agency for the Office of

7 Transportation and Air Quality.

8 I'm going the reiterate a lot of what Craig

9 Duehring said.

10 Several years ago, the EPA launched our

11 environmental scoring system for light-duty vehicles. It

12 very much mimics what is being proposed today in your

13 amendment. We have been working very closely with ARB.

14 We will continue to work with ARB because our hope is that

15 down the road, we can come up with one scoring system that

16 will work federally, in all states. But as he articulated

17 so well, there are a couple issues with different data

18 sets that we think we see a future in harmonizing. It's

19 just going to take a little longer.

20 We are here today to show our support. We think

21 we have the same goal, which is ultimately to provide

22 consumers with easily accessible environmental information

23 about their vehicles. And that's really it.

24 Thank you for letting me speak.

25 CHAIRPERSON SAWYER: Thank you.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345320

1 Mr. Raney. And then we'll have Patricia Monzlan

2 and John Cabaniss.

3 MR. RANEY: Thank you, Dr. Sawyer and members of

4 the Board. I brought some handouts for you that,

5 hopefully, will support our statement, visuals. Picture

6 tells a thousand words, sometimes.

7 While they're being handed out I can try to

8 answer some of your questions, Dr. Sawyer, about the size

9 of the label and where they're applied. The Monroney

10 label size that is currently used is pretty much governed

11 by the printer technology. It's standardized across the

12 industry and the printers at the distribution points, not

13 necessarily the factories. I don't know for sure, but I

14 don't believe that any manufacturer's applying a Monroney

15 label actually at the factory, it's happening at the

16 distribution point which is where the printers are. So

17 that's governing the size of paper that you have in front

18 of you.

19 I think that's all the questions that you had.

20 But I'll be happy to.

21 Placement. Oh, yes. In fact, we have a case in

22 our own particular model line where we have a two-seat

23 sports car, the S-2000, and because of the prohibitions

24 from putting it on the driver door window, it actually

25 does go on the windscreen now, the front windshield. So

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345321

1 we're very careful of putting it up in the upper

2 right-hand corner to try to avoid any problems with demo

3 drives and any impact on safety and visibility. But it is

4 a challenge for spacing.

5 What you have in front of you is the gist of my

6 statement and it's the focus of my statement. Honda does

7 not appear before you folks very much. When we do appear

8 before you, I hope you've recognized that it's something

9 that's important to us. We do try to come to you with

10 very constructive positions and alternatives and we do try

11 to present an air of cooperation.

12 What we are bringing to you today, I would hope

13 you would recognize, is very important to us. We spend an

14 enormous amount of research and development money and

15 actually bring it to our products towards improving the

16 fuel efficiency of our fleet and individual models.

17 Getting fuel economy, fuel efficiency information to the

18 consumer is something we spend a lot of time on. We spend

19 a lot of time in our product planning and documentation in

20 our sales brochures. So I would hope you would recognize

21 that we don't take this issue lightly. We believe that

22 getting information out to the consumer is very important,

23 which is why we're very supportive of what the staff is

24 doing here. They've done a tremendous job of working with

25 the complex nature of consumer information, and I think

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345322

1 the overall thrust is a good one.

2 But the main challenge that we have, and that's

3 what I'm going to address now, is that the size of the

4 label inherently prohibits us from putting this label on

5 the Monroney label. And we happen to believe that that is

6 the most important point. It is the one point that a

7 consumer goes to when first enters a showroom, he wants to

8 know what the price of the car is and what that price

9 brings. So we believe that it's important to try to

10 capture that moment when the individual buyer is looking

11 at the vehicle for the first time. And we believe that

12 that will be captured, that the fuel efficiency

13 information, greenhouse gas information, would be captured

14 at that the moment if, indeed, this information is on the

15 label itself.

16 What you have in front of you, the staff saw for

17 the first time last week. This is the first time you've

18 seen this. And I took this to our graphic design team,

19 our product planning people, and our sales people, and I

20 was able to squeeze every last inch of, millimeter of

21 space out of this Monroney label that I can. As you can

22 imagine, it's very important geography.

23 So the way we came up with two and a half by four

24 and a half inches, this is the maximum amount that I can

25 get with all the other information that's required. You

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345323

1 have a slide there in front of you that depicts really

2 what governs that. The fuel economy label mandated by EPA

3 is governed by regulation. And the Cars for Stars

4 information, the safety and crash test information is

5 governed by regulation, Congressional mandate. The

6 Domestic Parts Content information is governed by the font

7 size. So we're a bit it challenged there. So there's not

8 much space left and that's where we ended up with a two

9 and a half by four and a half number.

10 There was mentioned earlier that this would go in

11 all 50 states. Fifty state models. From our perspective,

12 we've been doing that with the Smog Index Label. But if

13 you allow us to do this, we would continue to do that in

14 all 50 states. That would not be the case if we had to go

15 to a separate label. It would only be for California. So

16 I think you would lose something there.

17 I have had some conversations with staff after we

18 submitted this and there's been some concerns that the

19 document that you have in front of you, the font size may

20 be a bit small. And as early as this morning, I talked to

21 our graphic design team again, and they can go as far as

22 nine point, maybe even ten. Nine point size is reference

23 to nine point size is what you see in the vehicle

24 specifications section right now. So we can go to that

25 size. And still keep within the two and a half and four

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345324

1 and a half inch boundaries.

2 So what we would propose to you is to give us an

3 option. If manufacturers still wanted to go to a separate

4 label, I'm not going to debate four by six or three by

5 five. I have a point about that, though. But my main

6 point is to give us the option to continue to use the

7 Monroney label, which we strongly believe is important for

8 consumer.

9 On the three by five point, I would draw your

10 attention -- and I'm sorry, I'm running over here -- but I

11 would draw your attention to the one slide that we have in

12 front of you on the Acura TL. It's, I think, two slides

13 from the end in your handout. The photograph of an actual

14 application. We applied the existing Monroney label,

15 well, actually the modified one with our two and a half by

16 four and a half inch size. We applied that to the rear

17 left-side door and also put the four by six label on it.

18 And can you see they don't fit. We would be forced to

19 move the four by six label to the front windshield in this

20 case. Which I, inarguably, the Acura TL is not a small

21 sedan. It's a medium size car. So I think you'll see

22 this in many different cases. And I don't want to be

23 critical of staff, but I think this is important and our

24 product planning team reinforced this when I asked them

25 about focus groups. It's absolutely imperative when you

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345325

1 do a focus group to show the feature you're trying to get

2 a reaction from, show it on the car. And as far as I

3 understand, the focus groups did not have that

4 opportunity, the labels were never placed on a car, they

5 were given paragraphs, but not shown the labels on a

6 vehicles itself. And this is what we ran into when we

7 actually tried to show why this would work in the real

8 world.

9 If you reduce the separate label or the label

10 itself down to three by five, you might be able to fit

11 that on the TL. We did not try that. If you had to go to

12 a separate label.

13 Anyway, that concludes my testimony. Be happy to

14 answer any questions about how the industry applies these

15 things and develops them.

16 CHAIRPERSON SAWYER: What is your reasoning on

17 putting it on 50 state cars?

18 MR. RANEY: Well, it's easy to program. Once we

19 design the graphic, graphically design the Monroney label,

20 it's much easier to have it for all 50 states than to have

21 a separate Monroney label for individual states.

22 CHAIRPERSON SAWYER: And would that carry the Air

23 Resources Board name on it as well?

24 MR. RANEY: Yes, it would.

25 CHAIRPERSON SAWYER: Staff.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345326

1 MR. RANEY: We'd like -- we might ask for a

2 royalty on that, but I --

3 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: You

4 might charge for a placement fee, too.

5 Yeah, I think our view on this is despite the

6 response of the focus groups which I think we value a lot

7 because it's the people that actually look at and they

8 like the bigger label, that at least this design seems to

9 be exceptionally well done, in my viewpoint. The colors

10 really cause, I think, help overcome the size. I mean you

11 look at this, you do tend to look at these giant MPG

12 numbers up on the right-hand side and you see a little

13 tiny six and a seven down there, and what, I guess, we

14 would suggest that if you want to provide this

15 alternative, that we, as part of the 15 days, that we go

16 back and spec the font sizes for the various pieces and

17 make sure that the relevant stuff pops out as good as

18 possible. Because this is behind a window, it's on the

19 inside. So you get glare and other things that make

20 reading these white on green through a piece of tinted

21 glass a little more difficult. So we want, I think, the

22 numbers, my view, is that seven and six ought to be a lot

23 bigger than that, than it is on this.

24 But we could work, try to work out something like

25 that, if it's the Board's desire to provide this option.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345327

1 CHAIRPERSON SAWYER: Ms. Riordan.

2 BOARD MEMBER RIORDAN: Mr. Chairman, I would

3 absolutely want you to increase the font because I think

4 that's just too small. I'm sorry. But I'm visually

5 challenged. Not at a distance, but close up, and so I

6 really think that would be helpful.

7 CHAIRPERSON SAWYER: What do you do with dark

8 tint windows?

9 MR. RANEY: The photographs that you see are

10 tinted windows. And --

11 CHAIRPERSON SAWYER: Very dark or the darkest you

12 make?

13 MR. RANEY: Well, it is a challenge, if anybody

14 was to ever be forced to go to the windscreen and they

15 were concerned about visibility and they try to go into

16 the band at the top of the windscreen, that's prohibitive.

17 You couldn't see it. But we did apply an option with the

18 green background instead of the white that you see here,

19 and it was problematic. But the white contrast out in the

20 open or even in a showroom, it is quite noticeable.

21 BOARD MEMBER CASE: Mr. Chairman, just a comment.

22 I think it's a terrific idea. Seeing it on the

23 windshield, I think,would catch people's attention. There

24 does appear to be space for increasing the size of the

25 font. I think having it on every car by your manufacturer

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345328

1 across the United States and you can do it in other

2 locations, I think would be a real point in leading the

3 way as to this agency's effort to really create cleaner

4 air and also to acknowledge good choices.

5 Is there any legal issues with that, since, at

6 times, we have items that this moves forward and gets

7 challenged or needs a comment back from EPA, is there any

8 problem potential there that we're kind of asking for a

9 change to the Monroney label, that's actually a federal

10 label as I understand it?

11 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: No, I

12 don't think there is in this case, because if there was, I

13 think Honda would have already told us that they can't,

14 you know, there's some limitation on the label. So

15 they've worked, apparently worked it out within, as you

16 see on that one chart, where the other pieces are fixed by

17 law, there this much room left. And in terms of making

18 changes on the Board, that's, you know, you're, as long as

19 it's within the notice, you're welcome to make changes and

20 that's what we do in this, quote, 15-day changes, we'd go

21 back and put in the actual details of the font size needs

22 to be ten or 12 or whatever for this part, and then we'd

23 mail it out to the stakeholders again who get to comment

24 one more time. And assuming that it doesn't deviate a lot

25 from your general direction, then we would just go ahead

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345329

1 and make those final changes. If it deviated a lot, we'd

2 bring it back to you.

3 CHAIRPERSON SAWYER: Can I assume that we cannot

4 mandate that they put it on cars sold outside of

5 California. That would be their choice.

6 EXECUTIVE OFFICER WITHERSPOON: That's correct.

7 Though, Honda, as a policy choice, makes all their cars 50

8 state cars. So it makes sense the label would be a 50

9 state label.

10 CHAIRPERSON SAWYER: Supervisor Hill.

11 SUPERVISOR HILL: Thank you, Mr. Chair. I just

12 think this is quite compelling and I appreciate the

13 flexibility of staff in looking at that and taking that

14 back for furthers changes.

15 CHAIRPERSON SAWYER: All right. It sounds like

16 we think it's a good idea to allow the flexibility with

17 some appropriate modifications to what Honda has proposed.

18 And, therefore, you'd deal within the 15-day.

19 EXECUTIVE OFFICER WITHERSPOON: Slight challenge.

20 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Right.

21 Actually, I never get too many chances to compliment car

22 companies, but I also wanted to thank them for the fact

23 that they have had these sort of semi-permanent labels on

24 the back quarter-window which, if you look at this

25 picture, you can kind of see a vague little square in

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345330

1 there that used the California LEV Brothers language on

2 them. And they've done that, you know, it says: LEV,

3 ULEV, PZEV, et cetera. And those things stay on cars.

4 Nobody ever takes those off. So it's been, you know, I've

5 always been impressed that they've gone ahead and done

6 that. I think it helps benefit the program.

7 EXECUTIVE OFFICER WITHERSPOON: Oh, it does,

8 yeah. Absolutely.

9 CHAIRPERSON SAWYER: Thank you very much.

10 MR. RANEY: Thank you very much.

11 CHAIRPERSON SAWYER: Ms. Monzlan.

12 MS. MONAHAN: Thank you. It's Patricia Monahan.

13 CHAIRPERSON SAWYER: Oh, excuse me.

14 MS. MONAHAN: And apparently from -- I obviously

15 would receive a poor grade for handwriting.

16 Thank you for the opportunity to speak today on

17 the revised emission control and Smog Index labels. USC

18 would like to commend staff for producing a label design

19 that is clear and easy to understand. And which we hope

20 will help the consumer make smart vehicle choices.

21 We hope this program will impact consumer choice

22 and manufacturer in the same way that the Energy Star

23 program has helped consumers make better choices around

24 home products.

25 USC strongly supports the size of the label

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345331

1 because it will be easily seen and recognized by the

2 consumer. We haven't had the benefit of seeing the

3 proposal that Honda has made, but it's reassuring to hear

4 that you all think that it's equally visible.

5 We expect to see a reduction in smog and global

6 warming pollution from vehicles in the next few years

7 because of the implementation of various regulations and

8 we're glad to hear that CARB will be revising the -- or

9 evaluating on a periodic basis to make sure there's no

10 grade inflation.

11 So we just would like to strongly support the

12 Board's approval of this design and thank staff for

13 developing such a careful and thoughtful proposal.

14 Oh, and I'd like to say, my name is Patricia

15 Monahan, I'm speaking on behalf of the Union of Concerned

16 Scientists and the Natural Resources Defense Council.

17 Thank you.

18 CHAIRPERSON SAWYER: Mr. Cabaniss. And then

19 we'll have David Paterson.

20 MR. CABANISS: Hi, I'm John Cabaniss, Association

21 of International Automobile Manufacturers. AIM supports

22 CARB's proposal to improve information for consumers to

23 weigh in choosing among new vehicles. We also believe

24 it's important to provide consumers clear and accurate

25 information.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345332

1 We have two suggestions for -- well, actually two

2 reasons to, for a suggestion to improve the program. And

3 the reasons underlying this are to provide administrative

4 simplicity and to provide the best information for

5 consumers. Specifically, we request that manufacturers be

6 allowed the option to have the one to ten greenhouse gas

7 ratings based on EPA's fuel economy label values that are

8 developed through the vehicle certification program.

9 There are a number of advantages to this option.

10 It's administratively simple for both manufacturers and

11 CARB because it's based on current certification

12 procedures. This option also yields the most accurate

13 greenhouse gas emissions information to consumers because

14 EPA has recently adopted a five-cycle methodology for

15 calculating these label values. This five-cycle testing

16 ensures that these labels are much closer correlated to

17 real world driving patterns than the more limited

18 certification data that's used in the 1493 regulation.

19 The five-cycle testing includes cold temperature

20 operation, air conditioning usage, and higher speed

21 driving. None of these are reflected in the 1493

22 methodology. The inclusion of air conditioning usage is

23 particularly important since nearly all new vehicles today

24 have air conditioning and it's recognized, of course, that

25 air conditioning usage is an important factor affecting

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345333

1 greenhouse gas emissions.

2 Our proposed option would also ensure

3 harmonization now between CARB's labeling and EPA's

4 labeling and websites. And EPA's websites are visited by

5 millions of consumers each year and we believe that it's,

6 you know, it would be a bad idea to have conflicting

7 information for consumers to confuse them rather than help

8 them.

9 Finally, our option is based on EPA's current

10 regulation which is in effect today. While CARB's

11 proposal is based, at least in part, in the 1493

12 regulations which remain under review, this, our option

13 would ensure that the labeling program could move forward

14 on the proposed schedule without any delay.

15 In summary, our proposal is, would benefit the

16 automakers, CARB, and consumers, so we respectfully

17 request that.

18 In conclusion, I just simply point out that we

19 would like for you to adopt our option for the first three

20 years of the program. During that time we would work with

21 staff to evaluate the option so that you can determine

22 whether or not the flexibility should be allowed to

23 continue, and that would also give us a chance to work

24 with ARB and EPA on longer term harmonization.

25 Thank you.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345334

1 CHAIRPERSON SAWYER: Thank you.

2 Staff want to comment on Mr. Cabaniss's?

3 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yes. I

4 think we do not believe it's a good idea to use the EPA

5 fuel economy labels. We have been arguing ad nauseam in

6 court and everywhere else that greenhouse gases are not

7 identical to fuel economy and we give a number of

8 different examples about how we have many different gases

9 we use. And maybe the clearest example would be that if

10 some were to certify an E 85 dedicated vehicle, one that

11 runs on ethanol. Its fuel economy values would go in the

12 opposite direction of CO2, it would be lower and yet it

13 would have better CO2. And then that example, it just

14 wouldn't provide the right consumer information.

15 So we think sticking with the regulations that

16 you adopted under the 1493 is the best way of proceeding.

17 CHAIRPERSON SAWYER: Thank you.

18 Thank you, John.

19 Mr. Patterson.

20 MR. PATTERSON: Good afternoon. My name is Dave

21 Patterson from Mitsubishi Motors. While I agree with many

22 of the things that Mr. Raney was talking about here, I

23 want to caution the Board that for our manufacturer, we

24 cannot fit even the smaller size on our Monroney label.

25 As you know, from Mr. Raney's presentation, there's many

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345335

1 regulatory requirements and there's also internal

2 corporate requirements of what logos need to be on the

3 Monroney label. I only know this information as we went

4 through this with the recent change to the CAFE

5 requirement label for the EPA. And I know that the real

6 estate on the Monroney label is very valuable. And we

7 don't have enough to put a new Smog Index Label onto our

8 Monroney label. I talked to a couple of other

9 manufacturers just now, before I came up here, and there's

10 other manufacturers in the same situation.

11 We do like this as an option. If Honda's able to

12 do this, I think it can be effective. We would like to

13 have the option to have a similar size label that we are

14 able to attach. The six by four label is a large label to

15 try the attach to the side of a car, in the limited window

16 space that there's available. So a smaller label as we,

17 as the Alliance has put forth in their proposal, three by

18 five or somewhere around there, we would appreciate that.

19 Thank you.

20 CHAIRPERSON SAWYER: My own feeling is that it

21 should be either the four by six or something like the

22 Honda label. Putting on the Monroney label certainly

23 attracts the eye in a reasonable way. And if that's not

24 possible, then I think a four by six label is appropriate.

25 EXECUTIVE DIRECTOR WITHERSPOON: I agree.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345336

1 CHAIRPERSON SAWYER: Is that consistent with

2 staff's thinking?

3 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Yeah,

4 we believe that it needs to be bigger if it's going to be

5 by itself.

6 EXECUTIVE DIRECTOR WITHERSPOON: Right.

7 Absolutely.

8 BOARD MEMBER SPERLING: Just one little comment

9 that, you know, if any other company had come up

10 proposing, you know, this other change, I would have been

11 more skeptical. But Honda is the company that benefits

12 the most from displaying this information. And so if it

13 sees that as a preferable option, then that, to me, is

14 pretty compelling. So I'm ready to make a motion if we're

15 ready to --

16 MR. CABANISS: Dr. Sawyer.

17 CHAIRPERSON SAWYER: Yes.

18 MR. CABANISS: Could I make just one additional

19 remark?

20 CHAIRPERSON SAWYER: Okay. Certainly, John.

21 MR. CABANISS: And this has to do with the label

22 size. I don't know what other manufacturers are going to

23 do with regard to the U.S., total U.S. sales, but, and I

24 don't know having the information today about which ones

25 currently have it on the Monroney and which ones don't.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345337

1 But just as a piece of information for you, we've surveyed

2 our members not too awfully long ago and 98 percent of the

3 vehicles manufactured by AIM member companies are 50 state

4 cars. So, you know, Honda's 50 percent -- excuse me, a

5 hundred percent. There's several, many others that are a

6 hundred percent. There are a few that aren't. But all

7 together our members, like I said, are 98 percent of their

8 production 50 state cars. So it could be that others may

9 be willing to follow Honda's path as far as posting the

10 label nationwide.

11 CHAIRPERSON SAWYER: Okay. We need to take our

12 ex parte comments.

13 Dr. Gong.

14 BOARD MEMBER GONG: No.

15 CHAIRPERSON SAWYER: No. No. No. No.

16 I spoke this afternoon with David Raney and what

17 we discussed was similar to what he presented today.

18 BOARD MEMBER SPERLING: I spoke yesterday with

19 David Raney about this exact item.

20 CHIEF COUNSEL JENNINGS: Dr. Sawyer, I think it

21 would also be important at this time to announce closure

22 of the record with it being reopened, previous page.

23 CHAIRPERSON SAWYER: Yep. Got it. I will now

24 close the record on this agenda item. However, the record

25 will be reopened when the 15-day notice of public

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345338

1 availability is issued. Written or oral comments received

2 after this hearing date but before the 15-day notice is

3 issued will not be accepted as part of the official record

4 on this agenda item. When the record is reopened for a

5 15-day comment period, the public may submit written

6 comments on the proposed changes which will be considered

7 and responded to in the final statement of reasons for the

8 regulation.

9 Board has before it Resolution 7-26. Do I have a

10 motion to adopt.

11 BOARD MEMBER D'ADAMO: So moved.

12 CHAIRPERSON SAWYER: And a second?

13 SUPERVISOR HILL: Second.

14 CHAIRPERSON SAWYER: All those in favor.

15 CHIEF COUNSEL JENNINGS: Just a second, Doctor.

16 My understanding is that the intent of the Board be that

17 it adopt it with the modifications and the additional

18 modification discussed, proposed by Honda, which might be

19 characterized as with an additional modification allowing

20 the use of the label as part of the Monroney label as long

21 as it is at least two and a half by four and a half inches

22 in a contrasting color and in a minimum font size to make

23 it sufficiently noticeable and legible.

24 CHAIRPERSON SAWYER: I think I captured --

25 although I think the alternative color is green, right?

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345339

1 CHIEF COUNSEL JENNINGS: Yeah. I guess that's

2 automatic, the blue and the green.

3 SUPERVISOR HILL: And then that also -- isn't the

4 issue, if it does not go on the Monroney, then it has to

5 be the larger size elsewhere?

6 CHIEF COUNSEL JENNINGS: Exactly. That would

7 remain the case.

8 CHAIRPERSON SAWYER: Okay. Thank you for putting

9 that on the record.

10 BOARD MEMBER D'ADAMO: So moved with the

11 modification.

12 CHAIRPERSON SAWYER: With the modification.

13 BOARD MEMBER RIORDAN: Second.

14 CHAIRPERSON SAWYER: All those in favor, please

15 indicate by saying aye.

16 (Ayes)

17 CHAIRPERSON SAWYER: Opposed? Carried.

18 Thank you very much.

19 Agenda Item 7-7-6, proposed regulations for

20 certifying and testing of gasoline vapor recovery systems

21 used on aboveground storage tanks.

22 Ms. Witherspoon, please introduce this item.

23 EXECUTIVE OFFICER WITHERSPOON: Thank you, Dr.

24 Sawyer.

25 In 2000, ARB approved enhanced vapor recovery

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345340

1 regulations for gasoline dispensers that underground

2 storage tanks. Aboveground gasoline storage tanks such as

3 are in use throughout the Central Valley for agricultural

4 operations were not addressed at that time. The proposed

5 regulation establishes certification requirements, testing

6 procedures, and performance standards for gasoline

7 dispensing facilities with aboveground storage tanks.

8 Michael Werst of the Monitoring and Laboratory Division

9 will make the staff presentation.

10 Michael.

11 (Thereupon an overhead presentation was

12 presented as follows.)

13 AIR POLLUTION SPECIALIST WERST: Thank you,

14 Ms. Witherspoon. Good morning -- or I'm sorry -- good

15 afternoon, Chairman Sawyer and members of the Board.

16 Today, I will present for the Board's

17 consideration a proposal to amend regulations for the

18 certification and testing of gasoline vapor recovery

19 systems using aboveground storage tanks.

20 In 2000, the Board approved enhanced vapor

21 recovery performance standards for underground storage

22 tanks.

23 Staff is proposing to adopt enhanced vapor

24 recovery performance standards to control transfer losses

25 from aboveground storage tanks and adding standing loss

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345341

1 controls unique to these tanks.

2 --o0o--

3 AIR POLLUTION SPECIALIST WERST: To summarize the

4 proposed regulation, I will describe some background and

5 the reasons why this rulemaking is necessary and present

6 the proposal's objectives. I will touch on the roles and

7 responsibilities of the Board and Districts with regard to

8 vapor recovery and discuss Air Resources Board's field

9 study.

10 Next, I will describe the technical proposal and

11 talk about the environmental and economic impacts of the

12 proposal.

13 Finally, I will briefly discuss the public

14 outreach and close with staff's conclusion and

15 recommendations.

16 --o0o--

17 AIR POLLUTION SPECIALIST WERST: First, I will

18 provide some background information.

19 I am not going to get into a technical

20 description of aboveground storage tanks.

21 For the purposes of this regulation, the tanks

22 illustrated here represent aboveground storage tanks used

23 for the storage of gasoline. They are above and below

24 grade tanks intended for fixed installations that are not

25 backfilled, as opposed to underground storage tanks that

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345342

1 are below grade and backfilled.

2 Aboveground storage tanks can be either single

3 wall, double wall or protected tanks, the latter of which

4 has insulating qualities.

5 --o0o--

6 AIR POLLUTION SPECIALIST WERST: For an

7 aboveground storage tank there are two types of emissions,

8 standing losses and transfer losses. I will describe the

9 difference in this and the next two slides.

10 As the sun rises, the fuel temperature increases

11 inside the tank in relation to the ambient temperature.

12 When the temperature increases, the fuel inside the tank

13 evaporates, which in turn increases the pressure within

14 the tank.

15 Standing loss emissions occur when the evaporated

16 gasoline is vented to the atmosphere either through leaks

17 in the system or when the pressure limits of the pressure

18 vacuum relief valve are exceeded.

19 It is important to note that the standing loss

20 emissions are a function of the diurnal evaporation of

21 gasoline which is effected by the daily temperature cycle.

22 As the sun sets, the tank temperature lowers and emissions

23 decrease as air enters the tanks, completing the diurnal

24 cycle. The cycle is repeated the following day.

25 --o0o--

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345343

1 AIR POLLUTION SPECIALIST WERST: Now I will

2 discuss transfer losses which are associated with the

3 transfer of gasoline to and from aboveground storage

4 tanks.

5 The control of vapor during the transfer of

6 gasoline to the aboveground storage tank is called Phase

7 I. As shown by this slide, a Phase I vapor recovery

8 system returns vapors from the aboveground storage tank to

9 the cargo tank truck during deliveries, and eventually to

10 the gasoline terminal.

11 --o0o--

12 AIR POLLUTION SPECIALIST WERST: Likewise, the

13 control of transfer emissions associated with the transfer

14 of gasoline from an aboveground storage tank to a motor

15 vehicle is called Phase II. Most of the public is

16 familiar with Phase II which includes the nozzle and

17 dispenser. A Phase II vapor recovery system routes the

18 vapors displaced from fueling motor vehicles back into the

19 aboveground storage tanks.

20 --o0o--

21 AIR POLLUTION SPECIALIST WERST: The tank

22 population is approximately 9,600 aboveground storage

23 tanks in California. About two-thirds of aboveground

24 storage tanks are associated with agricultural operation.

25 Of these agricultural tanks, about two-thirds are located

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345344

1 in the San Joaquin and Sacramento valleys. The remainder

2 of these tanks are operated in marinas, fleet operations,

3 municipalities such as state, county, and local agencies,

4 and service stations.

5 Typical aboveground storage tanks range in size

6 between 250 and 12,000 gallons. These aboveground storage

7 tanks are both single wall and protected tanks.

8 --o0o--

9 AIR POLLUTION SPECIALIST WERST: Statewide, these

10 tank distribute approximately 3.31 tons per day of

11 reactive organic gases from storage and transfer losses of

12 gasoline which is equivalent to 1000 gallons of gasoline

13 per day.

14 About 2.95 tons per day of reactive organic gas

15 emissions are from standing losses and the remaining .36

16 tons per day are from transfer losses.

17 Statewide summertime emissions are approximately

18 4.92 tons per day due to higher temperatures.

19 --o0o--

20 AIR POLLUTION SPECIALIST WERST: Now I'd like the

21 present the objectives of the proposal.

22 The primary objective is to control standing loss

23 emissions which comprise about 90 percent of the total

24 emissions from aboveground storage tanks. It is an

25 emission category that is not specifically controlled by

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345345

1 the current regulations.

2 A second objective is to control Phase I and

3 Phase II transfer losses which comprise about ten percent

4 of the total emissions by making the aboveground storage

5 tank vapor recovery program consistent with the enhanced

6 vapor recovery underground storage tank program.

7 As mentioned earlier, in 2000 the Board approved

8 regulations that established new vapor recovery

9 performance standards for underground storage tanks.

10 These underground storage tank requirements did not apply

11 to aboveground storage tanks.

12 In addition, I will mention later that the

13 proposal will increase the reliability of certain Phase I

14 components.

15 --o0o--

16 AIR POLLUTION SPECIALIST WERST: I'd now like to

17 explain the roles of the Air Resources Board and districts

18 in the control of emissions from the storage and transfer

19 of gasoline.

20 The vapor recovery program relies on a

21 partnership between ARB and the districts. State law

22 requires the Board to adopt procedures and performance

23 standards for controlling gasoline emissions during

24 gasoline marketing operations, including transfer and

25 storage operations, to achieve and maintain ambient air

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345346

1 quality standards. It also thousands the Board to certify

2 vapor recovery systems. Only those systems certified by

3 the Air Resources Board can be sold, offered for sale, or

4 installed in California.

5 --o0o--

6 AIR POLLUTION SPECIALIST WERST: Districts have

7 the primary responsibility of regulating emissions from

8 stationary sources such as gas stations. To this end,

9 districts have adopted rules that require gasoline storage

10 and transfer operations, including those using aboveground

11 storage tanks, to be equipped with vapor recovery systems

12 certified by ARB.

13 State law requires districts to use ARB test

14 procedures to determine compliance with performance

15 standards and specifications. Currently, districts

16 require vapor recovery systems to control transfer

17 emissions such as Phase I and Phase II.

18 The proposal enables districts to require

19 standing loss control by itself or with Phase I and/or

20 Phase II vapor recovery, thereby achieving additional

21 emission reductions.

22 --o0o--

23 AIR POLLUTION SPECIALIST WERST: At this point, I

24 am going to switch from ARB and district roles to discuss

25 the technical basis for this proposal.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345347

1 The primary focus of the proposal is to control

2 emissions associated with standing losses. As stated

3 earlier, standing loss emissions represent about 90

4 percent of the total emissions from aboveground storage

5 tanks due to diurnal evaporation of gasoline.

6 ARB staff conducted a field study in 2005 to

7 measure emissions from uncontrolled tanks between 350 and

8 1000 gallons and evaluate a number of standing loss

9 control technologies. The site was located in western

10 Fresno County and evaluated pressure/vacuum relief valves

11 technology such as:

12 --o0o--

13 AIR POLLUTION SPECIALIST WERST: Carbon based

14 processors.

15 --o0o--

16 AIR POLLUTION SPECIALIST WERST: Shade

17 structures.

18 --o0o--

19 AIR POLLUTION SPECIALIST WERST: White paint.

20 --o0o--

21 AIR POLLUTION SPECIALIST WERST: And spray-on

22 polyurethane foam insulation.

23 I would like the take this opportunity to

24 recognize the California Independent Oil Marketers

25 Association and agricultural industry for providing the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345348

1 aboveground storage tanks and facilities necessary to

2 conducted the study.

3 --o0o--

4 AIR POLLUTION SPECIALIST WERST: The results of

5 the field study are graphically displayed in this chart

6 and show the average percent emission reductions using

7 different standing loss control technology configurations

8 as compared to uncontrolled aboveground storage tanks.

9 The three control technologies reducing emission

10 in the order of 65 to 67 percent are carbon canister, P/V

11 valve plus paint, P/V valve plus paint plus shade.

12 The P/V valve and insulation combination

13 demonstrated the greatest emission reduction at 97

14 percent.

15 The results of the field study led us to

16 establish the recommended control levels for our proposal.

17 The yellow line on the graph represents the recommended 60

18 percent control level for technologies used to retrofit

19 existing tanks. As you can see, five demonstrated

20 technology combinations are effective in meeting this

21 in-use requirement. The red line shows the recommended 90

22 percent control level for new tanks.

23 --o0o--

24 AIR POLLUTION SPECIALIST WERST: This table shows

25 the specific performance standards proposed in the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345349

1 regulation in terms of emission factors or pounds per 1000

2 gallon gasoline ullage per day for new or existing tanks.

3 For informational purposes, the table also shows

4 emission reductions by percent as well.

5 --o0o--

6 AIR POLLUTION SPECIALIST WERST: This slide shows

7 an example of a single wall tank that is upgraded to the

8 60 percent control level. As you see here, the tank is

9 retrofitted with a pressure/vacuum relief valve.

10 Additionally, the tank is painted white in accordance to

11 the manufacturer's recommendations with an ARB certified

12 paint. The tank now meets the minimum retrofit

13 requirement.

14 For new tanks the control level is 90 percent.

15 This level can be achieved with a P/V valve and either

16 insulation or a protected tank.

17 --o0o--

18 AIR POLLUTION SPECIALIST WERST: At the

19 suggestion of stakeholders, the proposal includes optional

20 standards for existing aboveground storage tanks. This

21 offers existing aboveground storage tank owners

22 opportunities to earn emission credits when the controls

23 exceed the minimum retrofit requirements. Applicants will

24 request certification of standing loss control levels that

25 exceed the minimum retrofit requirement of 60 percent.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345350

1 Equipment will be evaluated by ARB and will be certified

2 at the 76 and 90 percent levels in addition to the 60

3 percent level. While these technologies will be more

4 costly, some of those costs will be recovered through fuel

5 savings.

6 --o0o--

7 AIR POLLUTION SPECIALIST WERST: Now I will

8 discuss controls for Phase I transfer losses.

9 Phase I vapor recovery systems used with

10 aboveground storage tanks are currently required to be 90

11 percent efficient. The adoption of the proposed

12 regulation will increase the aboveground storage tank

13 Phase I transfer efficiency to 98 percent to make it

14 consistent with the Phase I enhanced vapor recovery

15 systems used with underground storage tanks.

16 The establishment of stricter performance

17 standards and longer periods of certification testing will

18 also lead to more reliable Phase I vapor recovery

19 equipment such as emergency vents, tank gauges, and

20 adapters.

21 CAPCOA point out these that components are more

22 prone to failure. It is expected that many commercially

23 available Phase I components currently certified under the

24 enhanced vapor recovery underground storage tank program

25 will meet the proposed standards.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345351

1 --o0o--

2 AIR POLLUTION SPECIALIST WERST: Phase II vapor

3 recovery systems for aboveground storage tanks are

4 currently required to be 90 percent efficient. The

5 adoption of the proposed regulation will increase the

6 aboveground storage tank Phase II transfer efficiency to

7 95 percent to make it consistent with Phase II enhanced

8 vapor recovery systems used with underground storage

9 tanks.

10 It is expected that many commercially available

11 Phase II components currently certified under the enhanced

12 vapor recovery underground storage tank program will meet

13 the proposed standards.

14 --o0o--

15 AIR POLLUTION SPECIALIST WERST: The proposed

16 effective date of the regulation is January 1, 2009 to

17 allow sufficient time to certify enhanced vapor recovery

18 systems.

19 Existing tanks will have until January 1st, 2013,

20 or four years after the proposed effective date, to comply

21 as required by state law.

22 All the performance stands are and effective

23 dates can be found in the proposed certification

24 procedure, CP-206.

25 --o0o--

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345352

1 AIR POLLUTION SPECIALIST WERST: The

2 environmental impacts presented for are based on applying

3 standing loss controls to all tanks.

4 Upon full implementation of the proposed

5 regulation by January 1, 2013, the estimated annual

6 emission reductions associated with staff's proposal will

7 be about two tons per day of reactive organic gases. To

8 achieve these reductions, districts will need to amend

9 existing rules to require existing exempt facilities to be

10 subject to at least standing loss control.

11 When districts amend their rules to require EVR

12 certified P/V valves and paint, standing loss emissions

13 will be reduced up to 1.8 tons per day.

14 Note that the emission reductions achievable in

15 July are up to 2.94 tons per day due to higher

16 temperatures in summer.

17 --o0o--

18 AIR POLLUTION SPECIALIST WERST: The incremental

19 or initial cost for retrofitting existing tanks is

20 dependent on the district rules and summarized for

21 protected and single wall tanks in this table.

22 The incremental cost of Phase I and Phase II

23 upgrades represent the difference in cost between meeting

24 proposed requirements and current requirements.

25 District rules currently require Phase I and

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345353

1 Phase II controls for nearly one-third of the total tanks

2 in California. We anticipate that districts will amend

3 their rules to require standing loss controls for all or a

4 majority of tanks.

5 Additionally, if districts find that transfer

6 emissions are not significant, they may choose to modify

7 their rules to require standing controls instead of

8 Phase I vapor recovery.

9 Both of these district rule changes will achieve

10 substantial emission reductions at lower cost.

11 --o0o--

12 AIR POLLUTION SPECIALIST WERST: The

13 cost-effectiveness has been revised from $1.87 in the

14 staff report to $2.17 to correctly reflect the number of

15 tanks subject to the proposed controls. Although the

16 revision increase the cost-effectiveness slightly, the

17 proposal is still cost effective.

18 Upon full implementation by the Board and

19 districts of the proposed regulation, the cost

20 effectiveness for all California aboveground storage tanks

21 is approximately $2.17 per pound of reactive organic gases

22 emissions reduced.

23 This is based on annual emission reductions and

24 has been adjusted to include standing loss controls for

25 the majority of tanks. Including the cost savings from

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345354

1 gasoline, approximately 40 cents per pound based on $2.50

2 per gallons, the net cost-effectiveness of the proposed

3 regulations is $1.77 per pound on an annual basis. For

4 July, the net cost-effectiveness will be approximately

5 $1.01 per pound including the 40 cents per found in

6 gasoline savings.

7 --o0o--

8 AIR POLLUTION SPECIALIST WERST: Finally, staff

9 conducted extensive public outreach to encourage

10 participation from stakeholders as shown here. The

11 Ombudsman will detail the public outreach associated with

12 the proposed regulation at the conclusion of this

13 presentation.

14 --o0o--

15 AIR POLLUTION SPECIALIST WERST: In conclusion,

16 staff's proposal was developed with extensive public

17 outreach. The proposal reduces almost two tons per day of

18 reactive organic gas emissions with a cost-effectiveness

19 of $1.77 per pound.

20 The proposed regulation is achievable using

21 current vapor recovery control technologies and

22 incorporating new technologies that can control standing

23 loss emissions and will help make progress toward

24 achieving California's state and federal ozone ambient air

25 quality standard.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345355

1 Staff is proposing minor technical changes to the

2 certification and test procedures that would reopen the

3 public comment period for 15 days. These minor changes

4 shown in attachment C of the resolution would correct

5 drafting errors and make the proposed aboveground storage

6 tank certification and test procedures consistent with

7 existing vapor recovery regulation.

8 In addition, this morning, staff met with

9 representatives from the Steel Tank Institute to discuss

10 their comments. As a result, staff agrees to clarify the

11 testing protocols. This will be included as part of the

12 15-day changes. These changes are reflected in the

13 resolution and Attachment C.

14 Staff recommends that the Board approve the

15 proposed regulation with 15-day changes.

16 Thank you. And that concludes this presentation.

17 CHAIRPERSON SAWYER: Thank you, Mr. Werst.

18 Madam Ombudsman, please describe the public

19 participation that occurred while this item was being

20 developed and report any concerns or comments you may have

21 to the Board.

22 OMBUDSMAN QUETIN: Thank you. Dr. Sawyer, and

23 members of the Board. This proposed regulation has been

24 developed with input from the representatives from the Air

25 Pollution Control Districts, the farming, dairy,

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345356

1 automotive and petroleum industries, manufacturers of

2 vapor recovery equipment, as well as manufacturers and

3 distributors of aboveground storage tanks.

4 Staff began their efforts to develop this

5 regulation in June 2001. They held a total of ten public

6 workshops from June 2001 through December 2006, nine of

7 which were held in Sacramento. The tenth workshop was

8 held in Fresno. On average, about 50 stakeholders

9 attended these workshops.

10 In addition to the workshops mentioned, staff

11 gave quarterly updates to CAPCOA on the progress in

12 developing the aboveground storage tank certification

13 procedure. Staff also provided information and updates on

14 the proposal to the ARB Agricultural Advisory Committee

15 for Air Quality. This group consist of over 50

16 representatives of farm bureaus, commissions, and

17 associations as well as government agencies. Staff also

18 held four workgroup meetings in Fresno to facilitate

19 participation from agricultural stakeholders.

20 On August 16th, 2006, staff met with other

21 stakeholders in various agricultural groups and

22 associations to discuss the proposal, and also with the

23 Steel Tank Institute to specifically discuss testing

24 conducted for the proposed regulation as well as the cost

25 analysis.

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345357

1 Both the staff report and the Board hearing

2 notice were released for public comment on May 4th, 2007.

3 Notices of the staff report were posted to the ARB

4 website. Hard copies were mailed to stakeholders. And an

5 Internet message was sent to the over 2000 subscribers of

6 our list serve.

7 Thank you. That concludes my comments.

8 CHAIRPERSON SAWYER: Thank you very much.

9 Early in my term as Board Chair, I had the

10 opportunity to visit the test site where much of the work

11 was done. And I want to compliment Mr. Ahuja and

12 his staff for the way they developed this measure and how,

13 and for the affected farming community, primarily that

14 they were dealing with. I think that both we and they

15 learned a better way to do it in the process of testing.

16 And that should be model for how we develop new

17 regulations.

18 Do any Board members have questions?

19 Ms. D'Adamo.

20 BOARD MEMBER D'ADAMO: Well, just a comment. I

21 want to ditto what you just said, Mr. Chairman. And also

22 want to compliment staff for the extensive outreach on

23 this. And also the agricultural community represented by

24 Roger Isom here today.

25 I first heard about this, it's at least three

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345358

1 years ago, and there were a lot of concerns about cost and

2 implementation and I think now with the agricultural

3 community on-board here, we're going to see implementation

4 much sooner because they understand the program. They've

5 embraced it. So thank you very much for all of your

6 efforts.

7 CHAIRPERSON SAWYER: Ms. Berg.

8 BOARD MEMBER BERG: I just had one question on

9 the tank certification itself. Do these tanks have to be

10 certified from time to time for tank integrity.

11 STATIONARY SOURCE TESTING BRANCH CHIEF AHUJA:

12 Initially, before seeking certification they have to

13 submit an application and go through a testing procedure.

14 After that, if there is no issue there, then they get

15 automatically renewed after four years. However, if the

16 issues come up, then we have to investigate issues, and

17 obviously if there are issues, they will not be, then it

18 will not renewed, the certification would not be reviewed.

19 BOARD MEMBER BERG: And that certification is

20 with us. Is there any other agencies that certify because

21 this is hazardous materials, aren't these class one

22 flammables.

23 STATIONARY SOURCE TESTING BRANCH CHIEF AHUJA: We

24 have -- before it -- no. Let me back up.

25 Before an application is submitted, the applicant

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345359

1 has to work with other agencies, you're right. Including

2 the fire marshal, the water agencies, you know, the Water

3 Board, et cetera, to make sure that they are in compliance

4 with their respective regulations from other agencies,

5 that's correct.

6 BOARD MEMBER BERG: We would just want to make

7 sure that if we're recommending somebody put foam on a

8 tank, that they don't have to do certification every so

9 many years to guarantee the integrity of the tank.

10 Because one of the mechanisms that you use to measure that

11 integrity is to do a reading of the tank wall. And if you

12 put a permanent foam around that, then you're not going to

13 be able to get that reading in the same way. So it just

14 might be something we want to make sure that we're not

15 misleading people down the road and creating a problem

16 later on for them.

17 Thank you.

18 CHAIRPERSON SAWYER: We have two speakers on this

19 issue. Roger Isom and Jay McKeeman.

20 Mr. Isom.

21 MR. ISOM: Good evening, Mr. Chairman, members of

22 the Board. For the record, I'm Roger Isom with California

23 Cotton Ginners and Growers Association.

24 Really, the only reason I'm here is to show the

25 staff the same respect that they did in working with the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345360

1 ag industry. You've already mentioned that you visited

2 the site.

3 We started this process about two years ago when

4 the ARB staff came to us and said that, hey, we're going

5 to start regulating your farm tanks.

6 And our first response was we don't believe your

7 science, we don't believe there are that many emissions

8 out there that you say there are. And so they set up a

9 testing site there in Firebaugh. And they did the

10 testing, and lo and behold, the emissions were 60 percent

11 higher than what they originally said they were.

12 And so, anyway, be careful what you ask for. You

13 might just get it.

14 But at least the key there is that the testing

15 was done on actual farm tanks at a farm location, and we

16 were out there and witnessed it. We actually brought our

17 members out to the site so that they could see it, and you

18 know, whatever the results are, so be it.

19 The second step was once we recognized that the

20 emissions were there, we sat down with ARB, listed all the

21 controls and tested those controls out there again in that

22 same site under farming conditions so that we could see as

23 well as the ARB staff what worked and what didn't work and

24 what was cost-effective and what was not.

25 And so after a year-long testing program, we came

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345361

1 to this consensus as to what would work and we just want

2 to say thank to you the staff.

3 Our only concerns now, and the amendments that

4 have been made to the resolution are that we continue this

5 relationship going forward with the certification. Right

6 now, the way the certification process would work is that

7 it would be incumbent upon either the paint manufacturers

8 or suppliers or the foam manufacturers to go out there and

9 do the certification. And quite honestly, if there's not

10 very many tanks out there, they're not going to waste

11 their time to do it.

12 We have asked the staff that we don't want to

13 wait till 2013. That we would like use to same site, same

14 location, same tanks, and actually start putting all of

15 the combinations together. One thing you have to

16 understand is that each paint and each P/V valve

17 combination has to be tested. So we want to do that. We

18 can do it all in one location. ARB staff can visit one

19 site, and we can have ten different paints, we can have

20 three different P/V combinations, we can have the foam

21 manufacturers do the same thing, and do it all at one

22 location. And, again, we can bring our members out there

23 so that they can see it done. We can start this summer,

24 even before this rule has gone to OAL for final approval,

25 start that process now. The extra controls that the

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345362

1 farmers want to do that to get emission reduction credits,

2 we can start on that now, which would help especially in

3 the San Joaquin Valley where we need to do stuff a lot

4 faster and a lot more than what we're doing at this

5 point.

6 So, again, just want to thank the ARB staff urge

7 them to urge the Board to consider that, to push that

8 certification process and to work with the ag community.

9 Thank you.

10 CHAIRPERSON SAWYER: Mr. Ahuja.

11 STATIONARY SOURCE TESTING BRANCH CHIEF AHUJA: In

12 fact, I have already mentioned to Mr. Isom that we will

13 continue to work in the same spirit that we have worked so

14 far, in a very cooperative manner. We have already set up

15 a tentative date, July 9, to meet with them and sort out

16 for the testing to start this summer. Long before for the

17 reg has already been approved by the Board and offered by

18 the agencies, in anticipation of working cooperatively

19 with them.

20 CHAIRPERSON SAWYER: Thank you.

21 Mr. McKeeman.

22 MR. MCKEEMAN: Good evening. I'm going to keep

23 my comments very short.

24 Following along with what Roger says, we've

25 developed an excellent working relationship with CARB

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345363

1 staff on, number one, cost-effective solutions: White

2 paint, commonly available, P/V valves, the ability for our

3 association and Roger's association to go out there and

4 certify that kind of technology. That's a win-win

5 situation where you get the regulated community and the

6 regulators together on the same page and the ability to

7 really fast track improvement to emission control.

8 So we want to thank the staff.

9 Just as a little bit of history, when we first

10 got engaged in this regulation in 2001, in essence, a

11 regulation was being developed that would have put all the

12 controls that were on underground storage tanks on

13 aboveground storage tanks. So we've come a long way in

14 terms of figuring out the right way to do this.

15 There are some technical comments that I have,

16 but we've been discussing those issues with staff today

17 and we feel very comfortable that we have a good

18 relationship and that we can get these issues worked out

19 as we go down the line.

20 So again, thanks very much to staff. And we

21 certainly urge approval of the proposal before you today.

22 CHAIRPERSON SAWYER: Thank you. That concludes

23 the public testimony.

24 Ms. Witherspoon, does staff have any further

25 comments?

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345364

1 EXECUTIVE OFFICER WITHERSPOON: Nothing further.

2 But thank both the witnesses for coming today and bearing

3 through a very long day, just so they could testify on

4 this item.

5 CHAIRPERSON SAWYER: Yes. Thank you both very

6 much.

7 I will now close the record on this agenda item.

8 However, the record will be reopened when the 15-day

9 notice of public availability is issued. Written or oral

10 comments received after this hearing date but before the

11 15-day notice is issued will not be accepted as part of

12 the official record on this agenda item.

13 When the record is reopened for a 15-day comment

14 period, the public may submit written comments on the

15 proposed changes which will be considered and responded to

16 in the final statement of reasons for the regulation.

17 Are there any ex partes comments, communications

18 that need, the Board members need to disclose? No. No.

19 No. None.

20 We have before us resolution 7-27. Do I have a

21 motion to adopt?

22 BOARD MEMBER RIORDAN: I would move that,

23 Mr. Chairman and then please add to that attachment C; is

24 that correct? I have an attachment C here.

25 CHAIRMAN SAWYER: Mr. Jennings?

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345365

1 CHIEF COUNSEL JENNINGS: Yes. Attachment C

2 contains the proposed 15-day modification.

3 BOARD MEMBER RIORDAN: So motion includes both.

4 CHAIRPERSON SAWYER: Thank you for noticing that.

5 Do I have a second?

6 BOARD MEMBER BERG: Second.

7 CHAIRPERSON SAWYER: All those in favor indicate

8 by saying Aye.

9 (Ayes)

10 CHAIRPERSON SAYWER: Opposed? Motion is carried.

11 This has been a very long day. I want to thank

12 the staff and the Board members for being so patient and

13 professional today.

14 Get a good night's sleep and we'll deal with

15 tomorrow, tomorrow.

16 We're adjourned.

17 (Thereupon the California Air Resources Board

18 adjourned at 6:44 p.m.)

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PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345366

1 CERTIFICATE OF REPORTER

2 I, TIFFANY C. KRAFT, a Certified Shorthand

3 Reporter of the State of California, and Registered

4 Professional Reporter, do hereby certify:

5 That I am a disinterested person herein; that the

6 foregoing hearing was reported in shorthand by me,

7 Tiffany C. Kraft, a Certified Shorthand Reporter of the

8 State of California, and thereafter transcribed into

9 typewriting.

10 I further certify that I am not of counsel or

11 attorney for any of the parties to said hearing nor in any

12 way interested in the outcome of said hearing.

13 IN WITNESS WHEREOF, I have hereunto set my hand

14 this 6th day of July, 2007.

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23 TIFFANY C. KRAFT, CSR, RPR

24 Certified Shorthand Reporter

25 License No. 12277

PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345